Economic growth is typically measured in per capita terms. But social welfare should arguably include the number of people as well as their standard of living. We decompose social welfare growth --- measured in consumption-equivalent (CE) units --- into contributions from rising population and rising per capita consumption. Because of diminishing marginal utility from consumption, population growth is scaled up by a value-of-life factor that exceeds one and empirically averages nearly 3 across countries since 1960. Population increases are therefore a major contributor, and CE welfare growth around the world averages more than 6\% per year since 1960 as opposed to 2\% per year for consumption growth. Countries such as Mexico and South Africa rise sharply in the growth rankings, whereas China, Germany, and Japan plummet. These results are robust to incorporating time use and fertility decisions using data from the U.S., Mexico, the Netherlands, Japan, South Africa, and South Korea. Falling parental utility from having fewer kids is roughly offset by increases in the ``quality'' of kids associated with rising time investment per child.

This talk is presented by the Macroeconomics Seminar, sponsored by the Department of Economics with generous gifts given through the Michael Beauregard Fund for Macroeconomics and the Economics Strategic Fund.