Like most things in nature, there is no definite answer. It all depends on a multitude of factors. Animals grow big if their food supply is plentiful. Certainly, there are natural limits to their growth. Too big and their movements become unwieldy: finding food gets more difficult and falling prey to predators becomes easier.
The link between animals and resource availability is evidently demonstrated by 'the island rule', a principle first articulated in 1964 by J. Bristol Foster. The island rule states that big mammals above the size of rabbits would scale down to dwarf equivalents of their mainland cousins while those smaller than rabbits would size up to no bigger than rabbits. This phenomenon has important implications to economics and politics, particularly globalisation and the coming break-up of nation-states. This natural rule for animals isolated on islands applies generally to non-carnivorous mammals because of their warm bloodedness and their low reliance on body size to procure food.
We need to appreciate the benefits and costs of having a warm blooded relative to a cold blooded one and why in the long run, the cold blooded stands a better chance of survival. Warm blooded animals can keep their body temperatures constant because their metabolic engines are always firing. This allows the mammals to maintain a sustained active lifestyle, moving around in search of food or running away from predators.
But warm bloodedness imposes a cost in terms of energy usage. A mammal's body thermal engine needs to continuously fire itself while cold blooded animals, such as reptiles can slow down and fire up as and when needed. Therefore for body size, a mammal must strike a balance between the need for finding food, evading predation and conserving energy. By and large, the environment in which it lives in dictates the appropriate size for its long term survival.
Mammals can grow to the largest being in the animal kingdom as exemplified by the blue whale. They can inhabit extreme regions from the hottest climate, found in deserts, to the coldest, i.e., Antartic and Artic. Only the Australian desert is off limits to mammals, mainly because the place is barren in its soil nutrients. Other deserts are quite forgiving as past geologic movements have brought nutrients to the surface. Reptiles on the other hand cannot survive the Antartic and Artic regions since ice crystals can be fatal to the reptilian cells but they can survive on the scarce nutrients of the Australian desert.
On the mainland, large non-carnivorous mammals that don't rely on speed or other non-body size related predator evading strategies, need to bulk up to deter predators. On the other hand, the small mammals take the opposite approach; they dwindle in size the better to hide in burrows away from predators. On an island, the rules differ because of the absence of major mammalian predators. Such predators cannot sustain themselves since, being at the pinnacle of the food chain, their population base on an island is too small to escape the genetic defects from inbreeding. As predators disappear, the big non-carnivorous mammals no longer need the protection afforded by their bulky size.
Being big is actually more efficient: Kleiber's law, named after Max Kleiber, states that the metabolic rate for a mammal is proportional to the 3/4 power of its body mass. While an elephant shrew has to consume more than its body weight daily, an elephant needs only four percent of its weight. But the elephant has to consume so much herbage that individually it is very vulnerable to a reduction in its resource availability. The elephant shrew, on the other hand, may suffer a decline in population but at least there will be enough members of its species to carry the species through.
So how do mammalian species adapt to diminishing resource availability. Where predators are absent, they adapt by modifying their body sizes but this happens in small increments over many generations. Large mammals now have no use for their bulk regardless of how efficient it is in terms of energy burned per unit of weight. Their long-term survival as species is more secure with size reduction. A given level of resource can now support many more members, increasing the odds of survivability. And for small mammals, freed from having to hide from predators, they can now grow in order to achieve a lower burn rate of energy per unit of weight.
This pattern plays out in other fields as well. Computers used to come only in mainframe size. Although a mainframe needs special cooling, raised flooring and dedicated systems programmers, at least it is being efficiently used for the purpose it has been bought for. Now with computers being ubiquitous and extremely mobile (a cellphone is now effectively a computer), the energy consumption in the form of time wasted by their owners on fickle tasks is staggering. ADHD is no longer an inherited isolated disorder; it is an acquired widespread phenomenon. This bodes ill for pattern recognition because lack of attention and focus frustrate the discovery of patterns underlying trends in economics, politics and other major fields relevant to human endeavours.
Nation-states are similarly subject to this pattern. As more wealth is generated, nation-states grow in size. Those that don't share a common culture form union of states in order to benefit from increased economic and human exchange. Small nation-states are expensive to sustain because their per capita costs of maintaining the trappings of bureaucracy are high. Unless blessed by resources from nature, small nation-states, such as Singapore must embrace free trade, playing their role as traders smoothing trades between other nation-states.
Now as the world enters what appears to be a long economically lean period, nation-states must certainly adapt themselves if they need to still maintain a semblance of nation-states. Big countries, such as the US must be prepared to scale down its size the way the Soviet Union did on its dissolution in 1991. The break-up of USSR and its successor, Russia, is still unfinished business. Communism failed from the beginning because it discouraged production. The USSR could sustain for so long thanks to its natural resources, namely, oil. When oil prices collapsed in 1986, the writing of the fall of USSR was already on the wall. Its withdrawal from Afghanistan in 1989 wasn't due to losses to the mujahideen but to the clobbering from slumping oil prices.
We are witnessing some states in the US facing budgetary nightmare while some others enjoying surpluses. These forces are pulling the US apart. How the US pulls itself together as a cohesive nation is an interesting development to watch. But eventually, the US has to give in because sustaining itself in its current form is expensive and demands continual wealth creation.
In nature, the ecology is in balance if predator and prey can never outwit each other. When the USSR in its heyday, offered itself as a counterbalance to the US, the global conflict was about two economic systems. Conflict wasn't emotional and passionate. If it so happened that in one area, the US and some Islamists fought each other out, the US didn't have to suffer the opprobrium from the entire Islamic world since it might be helping another Islamists in another corner of the world in opposing the communist threat.
The critical danger now arises with the unipolar world. The stable counterbalancing act is gone. China would never replace the Soviet empire. Its only interest in faraway countries is the grabbing of as many natural resources it can get its hands on. It doesn't offer any political ideology. Anything goes as long at it makes money, for China, that is.
The successful non-state combatants have realised that the key to survival is to dwindle in size until their big adversaries disappear by which time they can bulk up but not to the size of current nation-states. They no longer need the bureaucratic expense of a nation-state. They are no more warm-blooded mammals but cold-blooded - both literally and figuratively - reptiles or insects.
Ants could never subdue elephants and neither could elephants wipe out ants. But when food resources diminish, elephants would be the first to perish unless they could size down in time. Ants would still survive albeit with a reduction in the number of colonies. The lesson to the big nation-states is to refrain from engaging the jihadists outside the homeland. They could never defeat one another. The fall of nation-states would only come about from shriveling economic growth. But not having a clue on how to ameliorate the currently worsening crisis, their leaders have turned their gaze instead towards political issues beyond their borders. They may or may not have the right solution but they certainly are stuck with the wrong problem.