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Population aging and economic growth: From demographic dividend to demographic drag?
Other - SEPTEMBER 14, 2023

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Population aging and economic growth: From demographic dividend to demographic drag?

by Andrea Zander

While population aging will slow economic growth throughout much of the world in the next three decades, expansions of labor supply due to improvements in functional capacity among older people could potentially cushion much of this demographic drag, wrote Rainer Kotschy, a postdoctoral research fellow at the Harvard T. H. Chan School of Public Health, and David Bloom, a research associate at Harvard University, in a National Bureau of Economic Research white paper.

This paper examines the extent to which changes in working-age shares associated with

population aging might slow economic growth in upcoming years. The authors first analyze the economic effects of changing working-age shares in a standard empirical growth model using country panel data from 1950–2015. They then juxtapose the estimates with predicted shifts in population age structure to project economic growth in 2020–2050. Their results indicate that population aging will slow economic growth through

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