I
bought this book in 2014 but came to read it 2 weeks ago (and finish just now).
Anyway, the book is about the demographic and economic projection of the world
in 2032 based on 2012 data (it was published in 2013). Although the book is
entitled “Tomorrow’s World” but the coverage of the “World” is just 74
countries which excludes mostly small countries like Pacific Islands, Nepal,
Bhutan, the Vatican, etc. and mostly African countries whose demographic and
economic data is unreliable according to the author. The book is surprisingly
easy to read and not loaded with technical jargon that would alienate a non –
mathematically inclined reader. It is also not loaded with numbers and
mathematically formulations save for a quick explanation on the derivation of
the processed information, which is surprising for a statistics book. The writing
style of the author is pretty clear and straight forward and “cold” in that he
treats human beings (birth and deaths and all) as numbers (you would be
forgiven if you think that the author is a Vulcan)! The way the author structures
the chapters show a deductive step by step logical thinking process. It is as
if the chapters serve as an introduction to the next chapter and yet each
chapter can stand alone as in it could be read as a separate article altogether.
The insights offered by the author are both unique and useful. His analysis
incisive. The first half of the book is mostly demographics and it is irreputable
since the 20 – year time frame that the book analyzes, the projected future adult
population are already alive as of this writing, i.e. one could determine the
size of the workforce in the future as well as the number of newborns based on
the present population of young people. The second half of the book is about
economics or about the market size of each population segment and regions/
country and this is where it is contentious (like all other economic
projections). I personally find the authors projections conservative particularly
in relation to China, India, and Developing Asia and rather optimistic for
Western Europe and North America (and come to think that the author’s day job
is in Hong Kong and a China expert so to speak!). The basis for his economic
projection is the size of the future labor force based on demographics, the
trending employment rate, and the projected labor productivity based on the educational
level of the workforce (the higher the educational attainment, the more
productive is the labor force because of its capacity to utilize technology to
improve productivity). In short, the author is basing on the full potential of
an economy to do its projection which is the way to go but his assumptions of
employment rates particularly in relation to Europe, and North America seemed optimistic
while his assumption on the productivity of China in particular seemed
conservative. Another thing that I find questionable is the numbers on the
propensity to save and to spend. Note that the data is based on 2012 and it’s
just some 4 years after the Great Recession back then. People got burned in
that economic episode and therefore their propensity to save or to spend is anomalous
to the norm if the author’s data is based on that year of survey (to be fair,
the author didn’t mention the time frame of the data on propensity to save and
to spend used in the book, it is just inferred). Lastly, the elephant in the
room or shall I say in the book is China and India by virtue of their huge
population of more than a billion. Though the projections are conservative but I
find the authors insights pretty much stand out, unique. I mean you won’t hear such
informative and unique insights from other statisticians or marketers. It’s just
unique.
Since
the publication of the book, a lot of things have changed. China abandoned the
one child policy, its now a two – child policy and there are rumors of totally
abandoning that as well although the author imply that such change in policy
wouldn’t have any meaningful impact to the future demographics of China but it
remains to be seen since there are anecdotes of willful violations of the one
child policy during its heyday. Furthermore, there is an avalanche or tsunamis
of immigrants into Europe due to the Syrian Civil War and into the US due to “Dreamers”
and the consequent backlash against immigration. This immigration wave and its
curtailment would radically alter the age profile of the population and would
drastically affect future demographics with huge implications on the purchasing
power of the households in Western Europe and North America. Then there is also
technological advances with the rise of AI and robotics which could drastically
change the nature of jobs in the future, making some skills obsolete while a
precious few skills precious. Again, this would impact future labor
productivity, employment rate, and thence, purchasing power (to be fair, the
author did mention such possibility in the last chapter of his book but for
just a brief mention in relation to India). Lastly, the booming stock market in
the US, the ongoing Trade War, and the rise of Inflation after a decade of
slumber would hugely impact future economic growth potentials of regions which
again affects future income and buying power.
This
book is written for marketers in mind and it is useful indeed. I highly
recommend it however, use with caution as some projections may no longer be
valid.
No comments:
Post a Comment