General Commentary: The Global Growth of the Middle Class

   One of the most radical transformations of the 21st century could be the explosive growth of the middle class, especially in countries where virtually no middle class existed until recently.  I am convinced that aside from the many beneficial social and political effects of this change, it will also mean that more people will have the time and money to engage in recreational activities, including hobbies such as stamp collecting.

   According to Ernst and Young, the population of the world's middle class will increase by over 260% from 2009 to 2030, and by that year, two thirds of the middle class will live in the Asia-Pacific region. These trends, along with a concurrent trend toward global aging, have important implications for the philatelic investor.

    The break down of the projections provided by Ernst and Young is interesting: only North America's middle class declines in both absolute terms and as a proportion of the world's population: from 338 million/ 18% (2009) to 322 million/ 7% (2030). Europe's rises slightly in absolute terms but declines proportionately: from 664 million/ 36% to 680 million/ 14%.  It is the developing world which experiences the most dramatic transformation, led by Asia/Pacific: 525 million/28% to 3,228 million/ 66%. Central and South America and the Middle East/North Africa see a dramatic rise in absolute terms along with a corresponding proportionate decline: 181 million/10% to 313 million/6% and 105 million/6% and 234 million/5%, respectively. Sub-Saharan Africa's middle class increases in population by 334%, from 32 million to 107 million, while remaining 2% of the the global total.

   Obviously, these are only projections, and any number of circumstances may render them inaccurate. Furthermore, many other factors may also influence the future growth or decline in demand for a particular country's (or region's) stamps, so the middle class population stats should not be viewed alone when making such predictions.

   Other than the general positive effect of this "rising tide lifting all boats" on the hobby, the demand for certain stamps will be heightened when favorable trends coincide. The greatest increases in demand will be for better issues with popular topics from countries where both the growth of the middle class and aging of the population are occurring most rapidly. 

    The Stamp Auction Bidders and Consignors Union (SABACU) is a forum for discussing stamp auctions, and represents the interests of stamp auction bidders and consignors in their dealings with stamp auctioneers. All stamp collectors and dealers are welcome to join. 
  

General Commentary: The Aging Population and the Coming Stamp Market Boom

A 2007 UN Report describes global trends in aging, showing an "unprecedented, pervasive, and enduring" aging of the world population which will have "profound implications on many facets of human life." According to the report, those aged 60 and over comprised 8% of the world population in 1950, and this number increased to 11% in 2007. It is expected to double, to 22%, by 2050.

One of the "profound implications" of global senescence which has not been explored is its probable effect on philately. While no surveys or empirical studies have been done to determine the break-down of the "serious" stamp collecting population by age, it is commonly accepted that people start collecting stamps when they are young, set them aside for several decades, and then return to stamp collecting later in life, when they have the money and time to devote themselves to the hobby as serious collectors.

Consequently, we may expect a doubling of the "serious" stamp collector proportion of the general population in countries which have a substantial middle class. The effect will be less pronounced in less-developed countries. Overall, however, we may expect the global population of serious stamp collectors to swell by tens of millions over the next forty years, and continue to grow as the population continues to age. This will result in a stamp market boom, as a vastly expanded pool of serious stamp collectors competes for a static or diminishing supply of better stamps.

While a "rising tide may lift all boats," in this case, some boats will be lifted higher than others. Clearly, the aging trend should be factored into the equation when analyzing the growth potential of a particular country's better stamps. The UN Report cited above profiles the aging trend with a section that examines how it affects specific countries and areas (at the end of the report). A prudent stampselector might consider targeting issues from countries which have both growing middle classes and rapidly aging populations.

Those interested in learning about investing in stamps should read the Guide to Philatelic Investing ($5), available on Kindle and easily accessible from any computer.