In recent years, Hong Kong's senior officials have emphasised the need to attract talent and boost birth rates, recognising what we all know: the territory's population growth and GDP growth have both been on declining trajectories for years. The empirical correlation, underpinned by production function as theoretical basis, positions population as a driver of economic performance.
Yet production functions encompass more than labour and population alone. If population and economic growth rise and fall in lockstep, capital and total factor productivity would make no contribution to economic growth, leaving per capita GDP stagnant — a pattern Hong Kong appears to be displaying. In the United States, however, this relationship proves more short-term and cyclical. Examining historical annual population and economic growth data (19th-century population records remain incomplete), the two trends align within certain decades, but as the data window widens, the long-term relationship weakens, yielding a full-period correlation coefficient of just 0.05.
