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Productivity consequences of workforce ageing - Stagnation or a Horndal effect?

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Author Info
Malmberg, Bo () (Institute for Futures Studies)
Lindh, Thomas () (Institute for Futures Studies)
Halvarsson, Max (Institute for Futures Studies)

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Abstract

Data linking the production of value-added at the plant level to the individual employees provide an opportunity to deepen the understanding of how the labor force composition relates to productivity performance. In view of the anticipated aging of the workforce in industrialised economies a body of research has emerged that indicate that individual productivity has a more pronounced hump-shape than the wage profile. This paper studies these issues by examining the composition of the workforce at the plant level in relation to the productivity performance of the plants. Our data cover the Swedish mining and manufacturing industries 1985-1996. The fact that older workers selectively work with older capital may have biased results found in the literature. Endogeneity of workforce composition poses serious estimation problems, but our attempts to cope with these problems tend to indicate that biases in general go in the direction that productivity of the young is overestimated and the productivity of the old is underestimated.

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Publisher Info
Paper provided by Institute for Futures Studies in its series Arbetsrapport with number 2005:17.

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Length: 43 pages
Date of creation: 12 Dec 2005
Date of revision:
Handle: RePEc:hhs:ifswps:2005_017

Note: ISSN 1652-120X ISBN 91-89655-75-3
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Postal: Institute for Futures Studies, Box 591, SE-101 31 Stockholm, Sweden
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Related research
Keywords: workforce ageing; productivity growth;

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Find related papers by JEL classification:
J10 - Labor and Demographic Economics - - Demographic Economics - - - General
J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Christopher F Baum & Mark E. Schaffer & Steven Stillman, 2002. "Instrumental variables and GMM: Estimation and testing," Boston College Working Papers in Economics 545, Boston College Department of Economics, revised 14 Feb 2003. [Downloadable!]
    Other versions:
  2. Rafael Gómez & Pablo Hernández de Cos, 2003. "Demographic Maturity and Economic Performance: The Effect of Demographic Transitions on Per Capita GDP Growth," Banco de España Working Papers 0318, Banco de España. [Downloadable!]
  3. Hansen, Lars Peter, 1982. "Large Sample Properties of Generalized Method of Moments Estimators," Econometrica, Econometric Society, vol. 50(4), pages 1029-54, July. [Downloadable!] (restricted)
  4. Björn Andersson, 2001. "Scandinavian Evidence on Growth and Age Structure," Regional Studies, Taylor and Francis Journals, vol. 35(5), pages 377-390, July. [Downloadable!] (restricted)
  5. McMillan, Henry M. & Baesel, Jerome B., 1990. "The macroeconomic impact of the baby boom generation," Journal of Macroeconomics, Elsevier, vol. 12(2), pages 167-195. [Downloadable!] (restricted)
  6. Paul M. Romer, 1987. "Crazy Explanations for the Productivity Slowdown," NBER Chapters, in: NBER Macroeconomics Annual 1987, Volume 2, pages 163-210 National Bureau of Economic Research, Inc. [Downloadable!]
  7. Malmberg, Bo & Lindh, Thomas, 2004. "Demographically based global income forecasts up to the year 2050," Arbetsrapport 2004:7, Institute for Futures Studies. [Downloadable!]
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  8. James Feyrer, 2007. "Demographics and Productivity," The Review of Economics and Statistics, MIT Press, vol. 89(1), pages 100-109, 01. [Downloadable!] (restricted)
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Cited by:
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  1. Thierry Lallemand & François Rycx, 2008. "Are young and old workers harmful for firm productivity?," Working Papers DULBEA 09-02.RS, Université libre de Bruxelles, Department of Applied Economics (DULBEA). [Downloadable!]
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