Population ageing: what should we worry about? (original) (raw)
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Some Macroeconomic Aspects of Global Population Aging
2010
Across the demographic transition, declining mortality followed by declining fertility produces decades of rising support ratios as child dependency falls. These improving support ratios raise per capita consumption, other things equal, but eventually deteriorate as the population ages. Population aging and the forces leading to it can produce not only frightening declines in support ratios but also very substantial increases in productivity and per capita income by raising investment in physical and human capital. Longer life, lower fertility, and population aging all raise the demand for wealth needed to provide for old-age consumption. This leads to increased capital per worker even as aggregate saving rates fall. However, capital per worker may not rise if the increased demand for wealth is satis ed by increased familial or public pension transfers to the elderly. Thus, institutions and policies matter for the consequences of population aging. The accumulation of human capital also varies across the transition. Lower fertility and mortality are associated with higher human capital investment per child, also raising labor productivity. Together, the positive changes due to human and physical capital accumulation will likely outweigh the problems of declining support ratios. We draw on estimates and analyses from the National Transfer Accounts project to illustrate and quantify these points.
Is the ageing population the problem it is made out to be?
It is said that the ageing population in developed countries will cause state pension systems to collapse, cripple national health services and place unacceptable burdens on the state in terms of social benefits. This article challenges several prevalent myths about population ageing and repudiates the idea that ageing is a major economic and social burden. While it is indisputable that all advanced industrialized societies are ageing, this social fact has become a kind of mantra for opponents of the welfare state and for a collection of alarmists.
The Program for Research on Social and Economic Dimensions of an Aging Population (SEDAP) is an interdisciplinary research program centred at McMaster University with co-investigators at seventeen other universities in Canada and abroad. The SEDAP Research Paper series provides a vehicle for distributing the results of studies undertaken by those associated with the program. ABSTRACT Simulation methods are employed to explore the effects of immigration as a control instrument to offset the economic and demographic consequences of low fertility rates and aging population distribution. A neoclassical economic growth model is coupled with a demographic projection model. The combined model is calibrated and used in a series of experiments. The experiments are designed to generate the time paths of a hypothetical but realistic economic-demographic system under alternative assumptions about immigration policy. The government seeks to optimize policy results in the model, according to a specified criterion function. The model is calibrated with Canadian data but some experiments are carried out using initial populations and fertility rates of other countries. JEL Classifications: E17, J11, J18 RÉSUMÉ Nous utilisons des méthodes de simulation pour explorer les effets de l'immigration en tant qu'instrument de contrôle pour contrebalancer les conséquences économiques et démographiques d'un faible taux de fécondité et d'une population vieillissante. Nous associons un modèle de croissance néoclassique à un modèle de projection démographique. Le modèle combiné est calibré puis utilisé dans une série de simulations. Ces simulations visent à générer des trajectoires hypothétiques, mais réalistes, de l'économie et de la population sous diverses hypothèses de politique d'immigration. Le gouvernement est doté d'un critère propre lui permettant de choisir la meilleure trajectoire résultante.. Bien que le modèle soit calibré sur des données canadiennes, quelques simulations sont conduites à partir de distributions de population et des taux de fécondité d'autres pays.
Prospective Dimension of Population Ageing and Potential Use in Pension Security in the V4 Countries
2020
The main aim of the paper is to highlight the importance of remaining years of life in relation to demographic ageing. We use the V4 countries as our case study and analyse demographic ageing using the concept of prospective age and the relevant indicators to consider whether statutory retirement age should be readdressed given the rise in remaining life expectancy among seniors. The classic indicators show ageing is increasing in the V4 countries. Using prospective indicators we can see that not only is the level of ageing significantly lower but that it is progressing more slowly, and in some cases reversing. The prospective approach could also be important in setting pension age as it reflects changes in life and the principle of equitability. The results also show that the way pension age is fixed in the V4 countries may pose a risk to the sustainability of pension systems.
An Ageing Population, the Demographics of Brexit and the Pensions Crisis (Re-write
We are being informed that we are facing a pensions time bomb in the UK. A declining workforce when combined with a fixed retirement age, an unwillingness to raise taxes, inadequate personal provision, increasing overall life expectancy, and decreasing birth rates mean that people are retired for a longer portion of their lives making greater and greater demands on public and private pension provision and on public services while the numbers of people of working age who pay for those services fall. This it is argued is unsustainable so that it becomes necessary to discuss the thorny issue of inward migration of people of working age to make up the shortfall. However, there is a problem Brexit focused attention on this issue with a view to placing limits on this ‘influx’. Therefore, my purpose here is to consider how the end of free movement might impact on the migration of talented young people wishing to work in the UK and the corresponding impact this will have on the tax base and the pensions’ crisis. It will argue that EU migrants are making a significant contribution to the public finances and could offer a partial solution to the demographic problems being faced by the UK. There is, it will argue a demand for this labour which would be foolish to ignore. It also considers some of the alternative solutions, both public and private arguing that these are temporary fixes which fail to deal with the underlying problem.
A new stage of demographic change: A warning for economists
Russian Journal of Economics , 2018
The current stage of demographic changes in all countries that have experienced a demo graphic transition is characterized by two main features: (1) cessation of population growth; (2) a progressive increase in the total dependency ratio, which until recently, de spite the longrun population ageing, was declining. Both of these features are unfavorable from the economic point of view. In Russia, the situation is aggravated by the peculiari ties of the population pyramid, heavily deformed by the social and military upheavals of the 20 th century. The article shows that, for a long time, the demographic trends in Russia favored its economic development, but now the country is entering a long period of unfavor able demographic changes. The cessation of growth of the Russian population, the reduc tion in the workingage population and its ageing and the increase in the dependency ratio will have a deterrent effect on economic development and, at the same time, make it more difficult to solve social problems. In particular, these factors will create greater problems for the pension system for people older than working age. The issue of using the migration resource to mitigate the negative consequences of demographic changes is discussed.