Problems and Advantages of Territories with Low Population Density

• DOI: https://doi.org/10.22533/at.ed.7002410057

• Palavras-chave: spatial economics, population density, territory, growth, profit.

• Keywords: -

• Abstract:

  We observe both territories with high and low population density. Low population density is often considered as disadvantage of a territory. Indeed, there should be reasons for people not to settle there: bad climate, natural disasters, remoteness from trade routes. But such areas often have an important advantage in high endowment of natural resources per capita. If all those resources belong to local inhabitants, they still can have low value without an access to the global market. Building infrastructure to create such an access and then to have sustainable development is a rational objective. However, it is a scale economy, which is cheaper per person if their quantity increases. Thus, low population density may become a self-reinforcing factor, preventing such development, and low populated territory can stay in a poverty trap. However, after passing some threshold with minimal infrastructure, the richness of such territory can grow fast, driven by still high endowment of natural resources per capita and ability to trade them. Yegorov (2009) presented a spatial economic model for spatially distributed resources, their harvesting and building road network with certain density, taking into account the difference in transport costs along a road and without it. It was shown that the profits of such territory are negative in the neighbourhood of zero population density and are maximal for a certain (optimal) population density. Then they start to decline for overpopulated territories. Yegorov (2016) considers an equilibrium between urban and rural areas and optimal rural population density. It depends on the global prices for energy and agriculture. Their high volatility in the last years undermined sustainability of such equilibria even when urban-rural harmony was formed in such country. The paper also analyses global heterogeneities in population density and infrastructure. Application of such models for different countries and regions can give important policy insights. Some territories can never reach high population densities due to restrictions in climate (like Canada) and water scarcity (like Australia). Other territories (like India) have rich soil and sufficient road infrastructure, but suffer from low resource endowment per capita due to overpopulation. Many countries have heterogeneous regions, with pooper areas which have problems with climate or access, and thus are underpopulated. Such an approach allows for theoretical analysis of territorial development and to make forecasts, based both on economic and geographical parameters, as well as policies.