Size Matters

What’s the best size for a country?

The Scottish National Party make much of Scotland’s population of around 5 million as conveniently the best size for a country – as though simply by being around 5 million nations are predestined to be “wealthier, happier and fairer” but does their claim stand up to investigation? 

In this article, I look at the pros and cons of smaller and larger nation-states, look statistically to see if population size correlates with countries being wealthier, happier, or fairer – and come to a broad conclusion on the optimum size. 

5 million isn’t a magic number

It isn’t easy to make broad generalisations about countries as each country has its unique circumstances, demographics and challenges. However, there are some examples of successful and struggling countries in the population range of 5 million.

One prosperous country with a population of around 5 million is Denmark. Denmark has a highly developed economy with a strong emphasis on exports and foreign trade. It also has a high standard of living and is consistently ranked as one of the happiest countries in the world. Scottish nationalists often point to it as a comparator country.

Another successful country with a population of around 5 million is Costa Rica. Costa Rica has a strong tourism industry and a growing economy, and it is also known for its efforts to protect the environment and promote sustainable development: all things Scotland, even within the UK, aspires to excel at.

On the other hand, there are also many examples of struggling countries with a population of around 5 million. A nationalist authoritarian government rules Belarus’s heavily centralised economy. Belarus has faced economic challenges and international criticism for its human rights record.

Another struggling country with a population of around 5 million is Zimbabwe. Zimbabwe has faced financial challenges and political instability, and it has been plagued by corruption, political nepotism and mismanagement of public funds. Also, unfortunately, things Scotland is becoming known for. 

So while we can say small countries can be prosperous, it’s not guaranteed.

Big can be beautiful

It’s perhaps easier to make the case that Larger countries have several advantages over smaller ones. They have a more diverse economy, a larger pool of resources, a more extensive tax base, economies of scale and a more robust military.

One of the main advantages of larger countries is that they have a more diverse economy. With a larger population and a more comprehensive range of geographic features, larger countries can support a greater variety of industries. This diversity provides a buffer against economic downturns, as a struggling industry in one part of the country can be offset by a thriving industry in another.

In the UK, this strength is seen in inter-regional fiscal transfers. Yes, while industry has declined in the north while finance brings in more in the south: regions like Yorkshire and Scotland have still been able to support higher public spending because money is moved within the UK.

Larger countries have a larger pool of resources. This includes natural resources such as land, water, and minerals and human resources like labour and talent. Having a larger pool of resources allows larger countries to support more people and provide for their needs. It also allows them to engage in large-scale projects and initiatives that would be impossible for smaller countries.

A third is that they have a more robust military. With a larger population, larger countries can recruit more soldiers and build a larger, more powerful army, navy and air force. This can provide a deterrent against potential enemies and make the country less vulnerable to both attacks and disasters: and more prominent influence on the world stage.

And finally, larger countries simply have significant economies of scale: if a universal public good needs to be delivered, or anything from driving licences to tax returns, working in bulk can make things cheaper to deliver per person. This has come to light with the transfer of some powers from Westminster to Scotland after the Smith commission or thinking of the set-up costs for any currently reserved powers if Scotland did go independent. Setting up a complex tax and benefits system for 5.5 million people, in terms of design, testing and infrastructure, can be nearly as difficult and costly as for 60 million people. 

How big is too big? 

However In recent years, there has been much debate about the efficacy of extensive countries like Russia, India, China and even the United States. The size and population of these countries allow them to wield significant power and influence on the global stage. However, these countries’ sheer size and complexity makes them inflexible and inefficient, putting them at a disadvantage.

One of the main arguments against such massive countries is that their size makes them inherently less flexible and adaptable than smaller countries. With a population of over a billion people each, India and China are behemoths. Their large populations require complex and extensive bureaucracies to manage, which can make it difficult for the country to respond quickly to changing circumstances and adapt to new challenges. 

Similarly, the United States, with its population of over 330 million people, has a vast and complex government that can respond slowly to changing needs and priorities.

Another major disadvantage of huge countries is that, in some ways they are less efficient than smaller countries. Because of their size, large countries often have to deal with a wider range of challenges and issues simultaneously, making it difficult for them to focus on a specific goal or objective. This can make it difficult for the country to allocate resources and focus on achieving specific goals, leading to inefficiency and waste.

In addition to these challenges, big countries often suffer from internal divisions and conflicts that can hinder their ability to function effectively. For example, Russia is a diverse country with various ethnic and cultural groups, and these groups often have competing interests and priorities. This can make it difficult for the government to effectively represent and serve the needs of all its citizens, leading to social and political tensions. Similarly, the United States has a long history of political polarisation and regional differences, which can make it difficult for the government to effectively address all its citizens’ needs and concerns.

So while massive countries have some advantages due to their size and population, their inflexibility and inefficiency can often put them at a disadvantage in others. However, large countries could streamline their bureaucracies and focus on their core goals and objectives to remain competitive and effective globally.

Are smaller countries really wealthier, happier and fairer? 

This was the central line being spun by the SNP Scottish government, but is there a basis for it?

Are people in smaller countries Wealthier?

This scatter chart was put together independently by WolframAlpha. The pattern shows no direct correlation showing a relationship between population and GDP per capita. Indeed, countries around the 5 million mark range from some of the poorest to some of the richest. 

population to gdp per capita

Conclusion: No, Simply being smaller doesn’t make a country’s people richer 

Are people in smaller countries happier? 

Scottish Nationalists want to move away from economic measures – for the obvious reason that the figures don’t back an economic case for separation. New qualitative measures such as “well-being” and ‘happiness’ are being brought in, and at first glance, it looks like there may be some merit to that. 

Looking at the 4 times winner of the happiest country – Finland – it comes top with a Scottish size population of 5.5 million, followed closely by Denmark at 5.8 million. 

The World Happiness Report uses global Gallop survey data to report how people evaluate their own lives in more than 150 countries worldwide. 

https://worldhappiness.report/

So is there a correlation between Population size and happiness? We plotted world happiness index data against population data then ran a correlation function on the data to see if there is a relationship between them. 

The correlation function calculates the correlation coefficient which can range from -1 to 1, with a value of 1 indicating a perfect positive correlation and a value of -1 indicating a perfect negative correlation. Basically, it looks at the two sets of data and sees if there is a mathematical relationship. The closer the value is to 0, the less correlation there is between the two sets of data. 

The -0.116 function shows a very weak negative correlation between a country’s population and its score on the happiness index. 

In layman’s terms: countries smaller than the average of 51 million may be slightly more likely to be happy …but there isn’t much in it. And If you take out India and China which are very large outliers at around 1.4 Billion people each, the correlation coefficient drops to basically zero at 0.004. 

Conclusion: No, Simply being smaller doesn’t make a country’s people happier. 

Are smaller countries fairer? 

One measure we can use is income distribution. It’s not a perfect measure of a concept of ‘fairness’ – which would need to include factors like gender equality and meritocracy but it is quantitative, robust data is available for 163 countries, and it seems a reasonable link to make that a fairer country will have a smaller gini coefficient. 

The Gini index, or Gini coefficient, is a statistical measure of wealth distribution developed by the Italian statistician Corrado Gini. The Gini index is used to gauge economic inequality by measuring income distribution, also called wealth distribution.

Looking at the correlation between the Gini Coefficient and population, we get a negative correlation -0.008 . Remember, the higher the gini index, the more unequal the wealth distribution, so in this case the negative correlation is that smaller countries are a little more unequal – however it is so close to zero as not to be a meaningful correlation. 

Conclusion: No, Simply being smaller doesn’t make a country fairer. 

It’s too convenient:

Even those who share this claim must surely know: if Scotland’s population was 3 million, the SNP would be making the case that 3 million is the ideal size for a successful country. 

If Scotland’s population was 15 million they would find some examples of thriving countries at 15 million and use them as examples. 

One of the disinformation techniques used by Big Tobacco, Climate Change deniers and Scottish Nationalists to downplay risk is cherry-picking of data. While the SNP have compared countries of around 5 million people over the years, they have also changed and cherry-picked which countries are used for comparisons: as I show in more detail here.  Their claim that countries with a population of around 5 million are blessed is because they started with Scotland’s population as the answer, then went and cherry-picked data to back the claim.

If triangles had a God it would have three sides. If Scottish Nationalists described a utopia, it would have a Scottish sized population

So what IS the best size? 

It is difficult to determine the optimum size for a country, as there are many factors to consider, and what may work for one country may not be for another. However, some experts argue that a country with a population of around 50 million is ideal.

A population of around 50 million allows a country to have a diverse economy and a good pool of resources to support its people. It also allows for a large enough military to provide a deterrent against potential enemies and defend the country’s interests. At the same time, a population of 50 million is small enough to allow for relatively efficient governance and decision-making. 

It’s could be a goldilocks size: not too small, not too big – just right. However – that conclusion also seems convenient for supporters of keeping the UK. 

So, Why Not Scotland? And Why Not Already?

As we have seen, there are pros and cons to larger or smaller countries. Small countries can be more flexible, potentially roll out public goods faster, and be agile in their responses. Larger countries can be more stable and diversified and have economies of scale that protect and deliver more public goods. 

Here’s the secret Scottish nationalists hope you don’t realise. A devolved Scotland within the UK is in a perfect position to take advantage of the benefits of both small and large countries. 

On matters where economy of scale is important: we have a stable currency, a diverse economy, a strong military, a large tax base to support our pensions from our ageing population & other benefits and even vaccine roll-outs – we can benefit from being part of the UK. On matters where there are small country advantages, being flexible, delivering social care and transport, we also should be able to take advantage of being 5 million, if only we had a government in Holyrood committed to making Scotland a success rather than devolution a failure.  

We have the best of both worlds already:

The best wee country in the world, underwritten by the 6th Largest economy. 

References:

https://www.gov.scot/publications/independence-modern-world-wealthier-happier-fairer-not-scotland/: Size Matters

world happiness index data against population data

Published by Bingo Demagogue

Twitter - @BingoDemagogue

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