The Gains to India From Population Control: Some Money Measures and Incentive Schemes

Abstract

RECENT surveys of population growth in RIndia and the slow progress of the Second Five Year Plan confirm the awful suspicion that India's extra consumer-goods output will be needed for extra population. Some Indians accordingly wonder if the central government should not now institute a program of incentive payments to families that limit births. This would be a logical evolution of schemes already developed in India, where three states and one large private company already offer free vasectomies, sometimes with a bonus, to certain of their employees. Such bonuses, if paid by the central government, could be large in terms of average family income, because the discrepancy between the average and marginal product of population is relatively very great in India. The discounted value to the economy of permanently preventing a birth is at least Rs 500-600, or about twice the value of per capita consumption. It is possible that two voluntary incentive programs one of vasectomies for husbands and another involving three examinations annually of wives for non-pregnancy might reduce births by 24 million over ten years at a resource cost of Rs I2 to i8 crores.' This reduction in births should reduce consumption during the ten years by Rs 750 crores with no loss of production. The possible resource return over ten years is hence about 50 to i. Resources so invested can perhaps raise per capita consumption several hundred times more effectively than if invested in conventional development projects. In this paper a preliminary attempt is made to estimate the value of permanently preventing a birth, to outline one incentive scheme for husbands and another for wives to reduce births, and to assess the impact of these schemes on the economy's resources and the government's finances.2 Threat of Population to Indian Progress