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The role of older workers in population aging–economic growth nexus: evidence from developing countries

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  • Siow Li Lai

    (University of Malaya)

  • Tien Ming Yip

    (University of Malaya)

Abstract

This study explored the relationship between population aging and economic growth in 74 developing countries between 1990 and 2019, highlighting the vital role of older workers (as measured by labor force participation of older people) in the national economy. A static panel estimator was used to examine the relationship between population aging, labor force participation of older people and economic growth. Results showed a negative association between population aging and economic growth, but the inverse relationship was mitigated by the labor force participation of older people. This indicates that the marginal impact of population aging on economic growth depends on the labor force participation of older people. The mitigating role of labor force participation of older people remained robust in a series of robustness checks. This study provides some policy recommendations to raise the labor force participation of older people to reduce the negative impact of population aging on economic growth. Effective utilization of human resources of older people is essential to bring about sustainable economic development.

Suggested Citation

  • Siow Li Lai & Tien Ming Yip, 2022. "The role of older workers in population aging–economic growth nexus: evidence from developing countries," Economic Change and Restructuring, Springer, vol. 55(3), pages 1875-1912, August.
    • Handle: RePEc:kap:ecopln:v:55:y:2022:i:3:d:10.1007_s10644-021-09370-4
    DOI: 10.1007/s10644-021-09370-4
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    More about this item

    Keywords

    Population aging; Economic growth; Labor force participation of older people; Developing countries; Static panel estimator;
    All these keywords.

    JEL classification:

    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity

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