scholarly journals The Phenomenon of Population Aging: Major Economic Effects (Ending)

2019 ◽  
Vol 14 (3) ◽  
pp. 8-53
Keyword(s):  
Capital Accumulation ◽  
Global Economy ◽  
Capital Investment ◽  
Population Aging ◽  
Capital Intensity ◽  
The Elderly ◽  
Economic Effects ◽  
Economic Consequences ◽  
Long Run ◽  
Pension Age

Today most countries are experiencing fast population aging, which is going to last the entire 21st century. Its economic effects are multifarious and will in large part shape further dynamics of the global economy not only in the short or medium but also in the long run. Unfortunately, Russian economists and politicians are hardly aware of how diverse economic consequences of population aging are since their attention is focused on its narrow, purely pragmatic, dimensions (such as the raising of pension age, the deficit of the Russian Pension Fund etc.). The paper provides a broad overview of major economic effects of population aging from both theoretical and empirical perspectives. It examines the place of aging in the process of demographic transition, and forecasts its expected trends in subsequent decades for a few countries including Russia. Next, it critically reviews different versions of dependency/support ratios: demographic and economic; chronological and prospective; non-adjusted and adjusted for differences by age in labor income and per capita consumption. Special attention is paid to a basic scheme of relationships between key demographic and macroeconomic variables that highlights how population aging might affect employment, labor productivity, capital intensity, wages, returns to capital, investment and savings. Some additional effects are also analyzed, such as prospective changes in labor supply, human capital accumulation, technological change, real interest, and inflation. A general conclusion is that population aging is not per se a fundamental economic challenge that should endanger society’s welfare. Real dangers arise from existing institutions providing support for the elderly, which were established in the early to mid 20th century under completely different demographic and economic conditions.

scholarly journals The Phenomenon of Population Aging: Major Economic Effects

2019 ◽  
Vol 14 (2) ◽  
pp. 8-63
Keyword(s):  
Capital Accumulation ◽  
Global Economy ◽  
Capital Investment ◽  
Population Aging ◽  
Capital Intensity ◽  
The Elderly ◽  
Economic Effects ◽  
Economic Consequences ◽  
Long Run ◽  
Pension Age

Today most countries are experiencing fast population aging, which is going to last the entire 21st century. Its economic effects are multifarious and will in large part shape further dynamics of the global economy not only in the short or medium but also in the long run. Unfortunately, Russian economists and politicians are hardly aware of how diverse economic consequences of population aging are since their attention is focused on its narrow, purely pragmatic, dimensions (such as the raising of pension age, the deficit of the Russian Pension Fund etc.). The paper provides a broad overview of major economic effects of population aging from both theoretical and empirical perspectives. It examines the place of aging in the process of demographic transition, and forecasts its expected trends in subsequent decades for a few countries including Russia. Next, it critically reviews different versions of dependency/support ratios: demographic and economic; chronological and prospective; non-adjusted and adjusted for differences by age in labor income and per capita consumption. Special attention is paid to a basic scheme of relationships between key demographic and macroeconomic variables that highlights how population aging might affect employment, labor productivity, capital intensity, wages, returns to capital, investment and savings. Some additional effects are also analyzed, such as prospective changes in labor supply, human capital accumulation, technological change, real interest, and inflation. A general conclusion is that population aging is not per se a fundamental economic challenge that should endanger society’s welfare. Real dangers arise from existing institutions providing support for the elderly, which were established in the early to mid 20th century under completely different demographic and economic conditions.

scholarly journals Pension Reforms, Population Aging, and Retirement Decision of the Elderly in a Neoclassical Growth Model

2021 ◽  
pp. 1-22
Author(s):  
Makoto Hirono ◽  
Kazuo Mino
Keyword(s):  
Capital Accumulation ◽  
Overlapping Generations ◽  
Population Aging ◽  
The Elderly ◽  
Key Factors ◽  
Overlapping Generations Model ◽  
Neoclassical Growth Model ◽  
Retirement Decision ◽  
Long Run ◽  
Neoclassical Growth

Abstract This study explores the linkage between the labor force participation of the elderly and the long-run performance of the economy in the context of a two-period-lived overlapping generations model. We assume that the old agents are heterogeneous in their labor efficiency and they continue working if their income exceeds the pension that can be received in the case of full retirement. We first inspect the key factors that determine the retirement decision of the elderly. We then examine analytically as well as numerically the long-run impact of labor participation of the elderly on capital accumulation and income distribution.

scholarly journals International Trade and Human Capital Investment with Heterogeneous Firms and Workers: Modeling and Analysis

Mathematics ◽  
2021 ◽  
Vol 9 (10) ◽  
pp. 1106
Author(s):  
Jaewon Jung
Keyword(s):  
Human Capital ◽  
International Trade ◽  
Organizational Behavior ◽  
Capital Accumulation ◽  
Global Economy ◽  
Capital Investment ◽  
Investment Decision ◽  
Heterogeneous Firms ◽  
Modeling And Analysis ◽  
Trade Model

Though the importance of organizational behavior and human decision processes within firms for the firm performance has largely been recognized in the business and management literature, much less attention has been devoted to studying such implications in the international trade context. This paper develops a general-equilibrium trade model in which heterogeneous workers make an investment decision in acquiring advanced managerial skills and choose their optimal effort level based on their comparative advantage. In doing so, we show how globalization-induced human capital accumulation within firms leads to sustainable economic growth. We also show that workers’ organizational belief and CEO’s managerial vision may be an important element for the human capital formation within firms and for the performance of firms in a global economy.

scholarly journals Do Aging and Low Fertility Reduce Carbon Emissions in Korea? Evidence from IPAT Augmented EKC Analysis

2020 ◽  
Vol 17 (8) ◽  
pp. 2972 ◽  
Author(s):  
Jaehyeok Kim ◽  
Hyungwoo Lim ◽  
Ha-Hyun Jo
Keyword(s):  
Co2 Emissions ◽  
Environmental Kuznets Curve ◽  
Population Aging ◽  
The Elderly ◽  
Ordinary Least Squares ◽  
Low Fertility ◽  
Kuznets Curve ◽  
Long Run ◽  
Carbon Dioxide Co2 ◽  
Robustness Check

The purpose of this article is to empirically find the Environmental Kuznets Curve (EKC) relationship between income and carbon dioxide (CO2) emissions and to analyze the influence of population aging on such emissions. We utilize Korean regional panel data of 16 provinces during the period from 1998 to 2016. To account for the nonstationary time series in the panel, we employ a fully modified ordinary least squares (FMOLS) and estimate long-run elasticity. From the empirical results, we can find the nonlinear relationship between income and CO2 emissions. Additionally, we verify the fact that population aging reduces CO2 emissions. A 1% increase in the proportion of the elderly results in a 0.4% decrease in CO2 emissions. On the other hand, the younger population increases CO2 emissions. These results were in line with those of additional analysis on residential and transportation CO2 emissions, for the robustness check.

scholarly journals Optimal taxation with unobservable investment in human capital

2019 ◽  
Vol 72 (2) ◽  
pp. 501-516 ◽  
Author(s):  
Catarina Reis
Keyword(s):  
Human Capital ◽  
Capital Accumulation ◽  
Optimal Taxation ◽  
Capital Investment ◽  
Physical Capital ◽  
Income Taxes ◽  
Long Run ◽  
Positive Rate ◽  
The Government ◽  
Physical Capital Accumulation

Abstract In a Ramsey model of optimal taxation, if human capital investment can be observed separately from consumption, it is optimal not to distort human or physical capital accumulation in the long run, and only labour income taxes should be used. However, in reality the government can’t always distinguish between investment in human capital and pure consumption, so a tax on labour or consumption will necessarily tax human capital. We find that when investment in human capital is unobservable, the optimal policy is to tax human capital at a positive rate, even in the long run. Whether physical capital should be taxed or not depends on its degree of complementarity with human capital versus labour.

scholarly journals Population and Economic Growth Under Different Growth Engines

2017 ◽  
Vol 18 (2) ◽  
pp. 182-211 ◽  
Author(s):  
Alberto Bucci ◽  
Xavier Raurich
Keyword(s):  
Economic Growth ◽  
Growth Rate ◽  
Human Capital ◽  
Population Growth ◽  
Capital Accumulation ◽  
Capital Investment ◽  
Human Capital Investment ◽  
Physical Capital ◽  
Long Run

Abstract Using a growth model with physical capital accumulation, human capital investment and horizontal R&D activity, this paper proposes an alternative channel through which an increase in the population growth rate may yield a non-uniform (i.e., a positive, negative, or neutral) impact on the long-run growth rate of per-capita GDP, as available empirical evidence seems mostly to suggest. The proposed mechanism relies on the nature of the process of economic growth (whether it is fully or semi-endogenous), and the peculiar engine(s) driving economic growth (human capital investment, R&D activity, or both). The model also explains why in the long term the association between population growth and productivity growth may ultimately be negative when R&D is an engine of economic growth.

Does Population Aging Affect Income Inequality?

2021 ◽  
pp. 320-335
Author(s):  
Gürçem Özaytürk ◽  
Ali Eren Alper ◽  
Fındık Özlem Alper
Keyword(s):  
Income Inequality ◽  
Pension System ◽  
Positive Impact ◽  
Population Aging ◽  
The Elderly ◽  
Dependency Ratio ◽  
Long Run ◽  
The Usa ◽  
The Uk ◽  
The Relationship

This study analyzes the relationship between the elderly dependency ratio and income inequality over the period 1972-2019 in countries such as the USA, Japan, the UK, France, Germany, Canada, and Italy, which rank top in the population aging, using the Fourier-Shin cointegration test. According to the results, the rise in the elderly dependency ratio of all countries included in the analysis, except for France, has a positive impact on income inequality. The result implying that the rise in the elderly dependency ratio increases the income inequality and renders some policy recommendations possible. Accordingly, the provision of adequate childcare programs and family aids can result in greater labor force participation in the short- and long-run. In addition, a pension system can be developed to lower the elderly dependency ratio, more money can be saved for the retirement period, and working domains can be developed for the post-retirement period.

scholarly journals The consequences of ageing for the Polish economy

VUZF Review ◽  
2021 ◽  
Vol 6 (4) ◽  
pp. 157-163
Author(s):  
Irena Brukwicka ◽  
Iwona Dudzik
Keyword(s):  
The Elderly ◽  
Economic Effects ◽  
Economic Consequences ◽  
Ageing Population ◽  
Negative Effects ◽  
Ageing Society ◽  
Care For The Elderly ◽  
Central Statistical ◽  
Negative Effect ◽  
Polish Economy

The ageing of population, as well as the expected decline resulting from the demographic changes, may have a negative effect on the economy, burdening national budgets. Poland has been among 30 demographically old countries in the world for years, and the ageing of the population has already begun in the early 1970s (Majdzińska A., 2015). The subject of the study is the economic effects of ageing society in Poland. The aim of the article is to present the economic consequences of ageing in Poland. The data from the Central Statistical Office on the demographic situation in Poland are used in the article. The ageing of the population is perceived as the dominant demographic process reflecting changes in the age structure of the population and the growth in the general elderly population. Therefore, the task of the state policy is to ensure the most optimal development for ageing population. The ageing of society imposes many tasks for social policy, including pension deficits, increase in healthcare service costs and care for the elderly, as well as slowing down in economic growth in the context of increasing social costs (P. Błędowski, 2012). Human ageing is a natural process, and at the same time, it has become a subject of interest among researchers working in various scientific environments. Therefore, it is necessary to regularly observe changes and undertake extensive discussions in this regard. It goes without saying that the course of aging process and its consequences require increased attention from experts and politicians. It is necessary to take up-to-date actions that will mitigate the negative effects in the future.

LONGEVITY, RETIREMENT, AND CAPITAL ACCUMULATION IN A RECURSIVE MODEL WITH AN APPLICATION TO MANDATORY RETIREMENT

2009 ◽  
Vol 13 (3) ◽  
pp. 327-348 ◽  
Author(s):  
Jie Zhang ◽  
Junsen Zhang
Keyword(s):  
Human Capital ◽  
Capital Accumulation ◽  
Capital Investment ◽  
Human Capital Investment ◽  
Mandatory Retirement ◽  
Retirement Age ◽  
Saving Rate ◽  
Recursive Model ◽  
Investment In Children ◽  
Long Run

This paper explores how retirement timing, together with life-cycle saving and human capital investment in children, responds to rising longevity in a recursive model with altruistic agents. We find that rising longevity raises the retirement age. If initial life expectancy is not too high, rising longevity also raises human capital investment in children and the saving rate. Through these channels, rising longevity can be conducive to long-run economic growth. A binding mandatory retirement age reduces human capital investment and the growth rate, raises the saving rate, and reduces welfare.

scholarly journals Do Long-Run Disasters Promote Human Capital in China? —The Impact of 500 Years of Natural Disasters on County-Level Human-Capital Accumulation

2020 ◽  
Vol 17 (20) ◽  
pp. 7422
Author(s):  
Zhidi Zhang ◽  
Jianqing Ruan
Keyword(s):  
Human Capital ◽  
Natural Disasters ◽  
Capital Accumulation ◽  
Capital Investment ◽  
Physical Capital ◽  
Human Capital Accumulation ◽  
Force Dynamics ◽  
Long Run ◽  
The Impact

Is there a relationship between the frequency of regional natural disasters and long-term human-capital accumulation? This article investigates the long-run causality between natural calamities and human-capital accumulation with macro and micro data. Empirical cross-county analysis demonstrates that higher frequencies of natural calamities are correlated with higher rates of human-capital accumulation. Specifically, on the basis of empirical data of the fifth census in 2000 and China’s Labor-Force Dynamics Survey in 2012, this paper exploits the two databases to infer that the high disaster frequency in the years of 1500–2000 was likely to increase regional human-capital accumulation on district level. High natural-calamity frequency reduces the expected rate of returning to physical capital, which also serves to increase human-capital. Thus, experiencing with natural disasters would influence human’s preference to human-capital investment instead of physical capital.

Sign in / Sign up

Export Citation Format

Share Document