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Some Economic Consequences of Global Aging


World Bank

Type: Report
Region: Republic of Ireland
Northern Ireland

 The note describes the importance of population aging world-wide, clarifyingits prevalence among middle- and low-income countries, which suggests that manydeveloping countries are getting old before they are growing rich. The note then asks inwhat way population aging is an economic problem and what are the specific challengesfacing developing countries in this process. The note argues against the common ?timebombperception?, and clarifies how a simplistic extrapolation from the impact of agingon single programs such as public pensions gives a misleading impression about the moregeneral macroeconomic consequences of population aging, where numerous elementscontribute to a more nuanced result. The note briefly discusses various topics ofimportance in the population aging debate, including: intergenerational flows, socialcontracts, the risk management element of old-age policies, and the impact of aging onhealth care costs. The note seeks to share a number of counterintuitive or simply nonintuitivefacts, including: (i) the large impact of declines in fertility on population aging(often more important than increases in longevity); (ii) the impact of increased lifeexpectancy on working age populations (often larger than among old age populations);(iii) the positive impact of aging on capital intensity; (iv) the need to include education inassessments of intergenerational equity (these often simply look at who pays for old-agepensions and health services); (v) the role of long-term care programs as insurance forrisks faced by young adults. 



Rights: Public
Suggested citation:

World Bank. (2011) Some Economic Consequences of Global Aging [Online]. Available from: [Accessed: 19th September 2019].


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