Tuesday, February 25, 2014

Case Study in Population Collapse: Bulgaria

A correspondent writes in with thoughts about the demographics of Bulgaria,

The reverse of a demographic dividend. This is obviously combined with a major decade-long political and socio-economic collapse starting in 1989.

Bulgaria finished 7th globally (!) in the 1988 Seoul Olympics with 35 medals. It tied for 63rd with 2 at the last games in London (0/1/1 vs 10/12/13 in Seoul). There are 2-3-4 track and field records by Bulgarians still standing from the 1980s (in W hurdles and W high jump). Doping testing is way better now of course.

Wikipedia in Bulgarian has tables from somewhere regarding Bulgarian agriculture over the years, from 1980 to now (kind of). The period was marked by the return of agriland from state-owned large scale farms to mostly urban dwellers who let the land sit fallow (i.e. my great-grandfather's land- small plots given to him as they were war refugees with nothing- is now legally co-owned by about 15 people).

Areas planted with wheat 1980-2009 up 30% (the only thing that is up)
Areas with corn down 52%
Areas with rye down 42%
Areas with beans down 100% (feels true, BG beans hard to find)
Areas with rice down 51%

Tons production 1980 vs. 2005
Apples down 93%
Plums down 87%
Apricots down 69%
Peaches down 85%
Cherries down 68%
Strawberries down 70%

Meat production tonnage down 75%
Milk production down 39%.

I am guessing Eastern Europe had a similar population dynamic (you can also see that the highest living standards, the biggest athletics successes, largest infrastructure project completions all happened around the population peak. I think the final marquee event was Croatia finishing 3rd at the World Cup in 1998. Steaua Bucharest won the 1986 Champions League, as did Crvna Zvezda Belgrade in 1991. In 1992, Serbia was banned from the Euro Championship for the Yugo Wars. Bulgaria just built its first major hydroelectric dam since 1970s and its second bridge over the Danube to Romania (1st and only one was built in 1954).
Wow, Bulgaria had a huge population collapse - from shockingly low birth rates (1.5 TFR) and migration. What's it like there? Is stuff cheap? Or can you still have a real estate bubble while losing 25% of your population - that would be amazing.
There was a RE bubble. Stuff is not cheap.

"Stuff" is priced globally more or less. Because of the production collapse, a lot is imported.

There were no mortgages until the early 00s. Then it was a free for all in the top 3-4 cities (prices are still 2x and more vs 2000). Also in became easier over time to work in the EU even before the 2007 entry so the disconnect bn incomes and housing became bigger (only rents are a true local market; like NYC you have foreigners bidding up, same in BG with emmigrants who don't know better). Also since ppl mistrust banks, they prefer buying property (low carrying costs too). Russians like the Black Sea coast (long a big resort destination for them) and that they can kind-of understand and be understood.

Also with the Communist government, people could not just move, so the population was more spread out (it's still like this in Russia). Now the top 3 cities are larger than ever, and some tertiary cities are down 50% from peak in population.
What are things like in the cities that have shrunk 50%? That's as bad as Detroit but in a shorter time period.
The difference vs Detroit is that you have a substantial % of the housing stock in large multi-family concrete "blocks" so fewer lights at night in a big buildings doesn't make a big difference.

A lot of the old industrial zones look post-apocalyptic. Usually roaming bands of gypsies have stolen everything. First metal for recycling, then doors/windows, then bricks and roof tiles here and there. They also steal the manhole covers from the street so now the utilities usually just use concrete that they break up if they have to get in.

Very uncrowded. People are old (combo state pensions and subsistence farming and support from kids; some move with the kids for the winter to save on fuel). Schools, hospitals and kindergartens get closed. There might be some small EU grant used for renovation in some part of town. Grass grows between the tiles on the sidewalks. If there was a planned and built out city center (ie fountains, sculpture gardens), it's usually very sad looking. Some of the houses where no one lives have paint chipping and uneven roofs (that's often the case with inhabited houses as well).
My copy of Harry Dent's The Demographic Cliff: How to Survive and Prosper During the Great Deflation of 2014-2019 just came. Review forthcoming.

1 comment:

Anonymous said...

You sure the correlation is population?

Maybe the lesson is, "Communism been bery bery good to me!"