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Can the ageing North benefit from expanding trade with the South?

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  • Georges, Patrick
  • Lisenkova, Katerina
  • Mérette, Marcel

Abstract

In this paper we estimate the benefit for the ageing North countries of diversifying some of their trade away from other North countries in favour of South countries. To this end we use a six-region overlapping generations model that takes into account the demographic trends of the 21st century and trade patterns. We show that ageing North countries can benefit from “enriching decay” through significant improvement in terms of trade. We estimate to what extent enriching decay can be bolstered if the North expands trade with the South. In Europe and Japan, for instance, an appropriate trade diversification strategy may prop up real per capita consumption by 2% and 2.4% respectively.

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Bibliographic Info

Article provided by Elsevier in its journal Economic Modelling.

Volume (Year): 35 (2013)
Issue (Month): C ()
Pages: 990-998

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Handle: RePEc:eee:ecmode:v:35:y:2013:i:c:p:990-998

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Web page: http://www.elsevier.com/locate/inca/30411

Related research

Keywords: OLG-CGE modelling; Population ageing; International trade; North vs. South;

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  9. Xiao-guang Zhang, 2006. "Armington Elasticities and Terms of Trade Effects in Global CGE Models," Staff Working Papers 0601, Productivity Commission, Government of Australia.
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  12. Fehr, Hans & Jokisch, Sabine & Kallweit, Manuel & Kindermann, Fabian & Kotlikoff, Laurence J., 2013. "Generational Policy and Aging in Closed and Open Dynamic General Equilibrium Models," Handbook of Computable General Equilibrium Modeling, Elsevier.
  13. Mérette Marcel & Georges Patrick, 2010. "Demographic Changes and the Gains from Globalisation: An Analysis of Ageing, Capital Flows, and International Trade," Global Economy Journal, De Gruyter, vol. 10(3), pages 1-39, October.
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