Demographic Transition, Aging Population and Economic Growth_Display 2024

Page 1: Introduction to Asia-Pacific Economies

• Course: ECON3320

• Topics Covered: Demographic Transition, Aging Population, Economic Growth

Page 2: Reference for Demographic Transition

• Study Reference:

  • Bloom, David E., and Jeffrey G. Williamson.

  • Title: "Demographic transitions and economic miracles in emerging Asia."

  • Journal: The World Bank Economic Review 12.3 (1998): 419-455.

Page 3: Overview of Demographic Transition

• Focus: The concept of demographic transition in relation to economic growth.

Page 4: Definition of Demographic Transition

• Concept: Transition from high fertility and mortality rates (preindustrial) to low fertility and mortality rates (postindustrial).

• Population Growth: Accompanied by changes in population growth and age structure.

Page 5: Crude Birth Rate Trends

• East Asia vs. Southeast/South Asia: Crude birth rate declined more rapidly in East Asia.

• Timing of Fertility Decline:

  • Countries like Korea, Malaysia, and Singapore saw fertility decline about 15 years after child mortality drop.

  • Thailand experienced a delay of around 25 years.

Page 6: Working-Age Population Ratio

• Working-Age Population Increases:

  • Ratio of working-age population (15-64) to non-working-age population has been rising in Asia since 1970.

  • Notably high increase in East Asia from 1975 to 1990.

Page 7: Demographic Overview of Asia

• Regions Covered:

  • Eastern Asia, Southern Asia, Central Asia, Western Asia, South-Eastern Asia.

• Countries Included: China, Japan, India, Indonesia, etc.

Page 8: Phases of Demographic Transition

• Phase One (1950s-1960s): Significant increase in the number of children.

Page 9: Phase Two of Transition

• Phase Two (1970s): Rise in working-age population outpacing young population growth in several countries.

Page 10: Future Projections

• Aging Population: Projections indicate that individuals aged 60 and older will dominate changes in the age structure in 34 countries.

Page 11: Demographic Transition Impact on Economic Growth

• Economic Dynamics:

  • Early stages: High youth dependency burdens and low working-age proportion hinder per capita income growth.

  • Later stages: Decreased youth dependency and increased working-age share boost income growth.

  • The shift from fewer workers to a higher share of working-age adults can lead to economic enhancement, followed by potential challenges from aging populations.

Page 12: Economic Growth Implications

• Initial Burden & Gift: Few workers can evolve into a gift when the working-age population increases, though this advantage may fade as the elderly share grows.

Page 13: Statistical Overview of 78 Economies

• Data Source: World Bank data on various demographic and economic variables from 1965-1990.

• Key Variables & Statistics:

  • Population growth rate, economic activity growth rates, demographic age group growth rates, GDP per capita statistics.

Page 14: Appendix—Economies in Data Set

• Included Countries: List of economies analyzed for demographic impact, including countries from Africa, Asia, the Americas, and Europe.

Page 15: Table of Population Growth Impact

• Growth Rate Factors: Impact of population growth, educational attainment, resource abundance, etc. on GDP growth rates.

Page 16: Economic Growth and Labor Force Dynamics

• Correlation: Faster growth of economically active populations corresponds to higher GDP per capita growth.

Page 17: Youth Population Impact

• Negative Coefficient: Increase by 1% in the population under age 15 negatively affects economic growth rates significantly.

Page 18: Older Population Growth Dynamics

• Growth Rates: Economic growth rates are slower when the working-age population's growth falls behind overall population growth before 1970.

Page 19: The East Asian Miracle

• Population Dynamics Contribution: Population changes have contributed significantly to GDP growth in East Asia, illustrating a connection between demographic shifts and economic outcomes.

Page 20: Economic Growth Projections

• Model Definition: If stable economic growth is set at 2%, miracle growth defined at 4.11% indicates substantial demographic influence on growth.

Page 21: Future Aging Population Forecasts

• Investigations: Impact of population aging on economic growth and projections for 12 developing Asian economies (2011-2030).

Page 22: Key Ratios in Economic Studies

• Old-age Ratio & Youth Dependency Ratio: Definitions of demographic measures pertinent to economic analysis.

Page 23: Population Trends from 1950-2050

• Graphical Trends: Graphs depict demographic shifts—young and elderly as a share of total population across various Asian economies.

Page 24: Growth Sources Summary

• First Demographic Dividend: Economic growth linked to the rise in the working-age share of the population—using production functions to represent growth.

Page 25: Economic Growth Components

• Growth Rate Equation: Four factors affecting GDP per capita growth.

Page 26: Contribution to Per Capita GDP Growth

• Components Breakdown: Detailed examination of GDP growth contributions across 12 Asian economies.

Page 27: Labor Characteristics Influence

• Labor Dynamics: Impact of various dependency ratios and labor variables on economic productivity.

Page 28: Depreciating Economic Growth Effects

• Economic Relationships: Presentation of age-related growth patterns and productivity factors impacting economic health.

Page 29: Calculation Methodology

• Regression Models: Explanation of statistical modeling including various demographics and growth trends.

Page 30: Effects on Labor Force and Economic Metrics

• Negative Correlation: Analysis of how an increase in old-age dependency impacts economic labor growth.

Page 31: Labor Productivity Insights

• Age Structure Effects: Understanding of how productivity is affected by demographics and dependency ratios.

Page 32: Longitudinal Growth Projections

• Statistical Growth Models: Displays the explicit relationship between demographic changes and growth metrics for better understanding.

Page 33: Balance Between Labor and Demographics

• Income vs. Age Economic Relationships: Outcomes of demographic shifts affecting labor productivity and capital accumulation.

Page 34: Youth Dependency Ratio Trends

• Growth Improvement: Lower youth dependency correlates positively with economic growth.

Page 35: Projections for Economic Growth

• Demographic Influence: Final collective impacts leading to growth rates based on changing dependency ratios.

Page 36: Aging Population Economic Outcomes

• Emphasis on Future Projections: Specific impacts of aging on economic growth through various models for Asian economies.

Page 37: Projections for Economic Growth by Country

• Detailed Projections: Specific projections for aging impacts on economic growth in various economies.

Page 38: Conclusions on Demographic Changes

• Future Strategies: Recommendations to address aging population challenges, including policy changes and social support systems.

Page 39: Reference Materials

• Publications for Further Reading: Various sources discussing population aging and economic impacts in Asia.

Page 40: Introduction of Labor Contributions

• Labor Participation Rates: Labor income dynamics among different age groups across selected Asian economies.

Page 41: Analysis of Older Adult Support

• Aging Transition: Trends in differing support needs between younger and older adult populations across Asia.

Page 42: Lifecycle Deficits in Economic Models

• Lifecycle Deficits: Discussion of labor income and consumption dynamics as it relates to age.

Page 43: Age Reallocation Systems

• Three Components: Outlines variables affecting population aging such as public transfers, familial transfers, and asset-based reallocations.

Page 44: Lifecycle Deficits Support Strategies

• Funding Mechanisms: Examination of social support sources for the elderly and their economic impacts.

Page 45: Public Sector Reliance Comparison

• Importance of Public Sector: Insights on how reliance on public sector support varies between older populations in Asia compared to other regions.

Page 46: Elderly Financial Support Structures

• Asset vs. Transfers: Analysis of financial support reliance, emphasizing familial over public sector transfers in Asian contexts.

Page 47: Support Mechanisms in Aging Economies

• Family vs. Public Support: Contrast of familial support versus public transfers in addressing elderly needs across different Asian economies.

Page 48: Fiscal Effects of Aging

• Fiscal Support Ratio: Discussion on how aging demographics will impact fiscal policies and ratios in the future.

Page 49: Healthcare Expenditure Projections

• Health Expenditure Trends: Historical and projected healthcare expenditures as a percentage of GDP in various Asian countries.

Page 50: Long-Term Economic Growth Strategies

• Demographic Implications: Discussion on managing growth through asset reliance in an aging population.

Page 51: Conclusion

• Final Thoughts: The overarching impact of demographic shifts on economic growth and the need for adaptive policies to support aging populations.