Economically Active Population

Background

The term “economically active population” refers to the segment of a nation or region’s populace that contributes labor to the production of goods and services. This includes all those who are working, as well as those who are actively seeking employment. The measure of economically active population provides critical insights into the labor market’s dynamics and the overall economic health of a society.

Historical Context

The concept of economically active population has evolved alongside socioeconomic structures and labor markets. During the industrial revolution, the composition and definitions of the labor force began to change, incorporating more diverse employment types such as factory work and services. Post-World War II economic expansion further broadened this concept as female and part-time employment grew in prominence. The creation of standard definitions and methodologies, such as those presented by the United Nations System of National Accounts (UNSNA), has allowed for more precise and globally comparable data.

Definitions and Concepts

The economically active population is a measure typically gathered and analyzed periodically through national labor surveys or census data. According to the UN System of National Accounts, this population includes all people of working age (typically aged 15-64, though this can vary by country) who are contributing or are available to contribute to the production process.

This metric usually encompasses the employed (both salaried and self-employed) and the unemployed who are actively seeking work. It might sometimes exclude certain populations, such as full-time students, retirees, or the disabled, unless they are part of the labor supply.

Major Analytical Frameworks

Classical Economics

Classical economists prioritize labor as one of the key factors of production. The economically active population is seen as a crucial component for understanding an economy’s capacity to grow and produce.

Neoclassical Economics

In neoclassical thought, the economically active population is integral for supply and demand models in labor markets. It adjusts according to changes in wages and productivity.

Keynesian Economics

Keynesian economics considers the economically active population in the context of total demand for goods and services. Employment levels and the labor force impact aggregate demand and thus influence economic stability and policies.

Marxian Economics

Marxian economics critiques focus on the dynamics between capital and labor. The economically active population here is important for understanding labor exploitation and surplus value created in capitalist systems.

Institutional Economics

Institutional economists consider the role of social, political, and economic institutions in shaping the labor market outcomes of the economically active population.

Behavioral Economics

Behavioral economists might study how cognitive biases and heuristics affect labor market participation within the economically active population.

Post-Keynesian Economics

Post-Keynesian theories might emphasize the role of expectations and effective demand in understanding variations in the economically active population and employment.

Austrian Economics

Austrian economists might focus on the entrepreneurial aspect of the labor market, seeing the economically active population as innovators and drivers of economic change.

Development Economics

Development economists often consider the quality of employment and the structure of the labor force within the economically active population to address issues of poverty and inequality.

Monetarism

Monetarists may analyze the relationships between monetary policy, inflation, and the unemployment levels within the economically active population.

Comparative Analysis

When comparing nations or regions, differences in the size and structure of the economically active population can reveal significant insights regarding economic performance, productivity levels, and social dynamics. Policies directed at increasing labor force participation, such as those involving education, training, and child care supports, can have substantial economic impacts.

Case Studies

1. Scandinavian Countries: Known for high female labor force participation.
2. Emerging Economies: Often showing rapid increases in economically active populations tied to industrialization and economic reforms.
3. Aging Populations in Developed Countries: Highlighting challenges in maintaining high levels of economic activity.

Suggested Books for Further Studies

1. “Labour Economics” by George J. Borjas.
2. “The Labor Market” by Martha L. Olney.
3. “Keynesian Economics and Unemployment” by Malcolm Sawyer.

Related Terms with Definitions

1. Labour Force Participation Rate: The percentage of the working-age population that is part of the labor force.
2. Unemployment Rate: The percentage of the labor force that is unemployed and actively seeking work.
3. Underemployment: Individuals who are working part-time or in inadequately paid jobs but desire full-time employment.

This structured entry aims to provide a comprehensive understanding of the “economically active population,” its measurement, analytical frameworks, and its significance in economic studies.