IDEAS home Printed from https://ideas.repec.org/a/aea/aejmac/v14y2022i4p479-98.html

Population Aging and Structural Transformation

Author

Listed:
  • Javier Cravino
  • Andrei Levchenko
  • Marco Rojas

Abstract

We quantify the role of population aging in the structural transformation process. Household-level data from the United States show that the fraction of expenditures devoted to services increases with household age. We use a shift-share decomposition and a quantitative model to show that US population aging accounted for about a fifth of the observed increase in the service share in consumption between 1982 and 2016. The contribution of population aging to the rise in the service share is about the same size as the contribution of real income growth and about half as large as that of changes in relative prices.

Suggested Citation

  • Javier Cravino & Andrei Levchenko & Marco Rojas, 2022. "Population Aging and Structural Transformation," American Economic Journal: Macroeconomics, American Economic Association, vol. 14(4), pages 479-498, October.
    • Handle: RePEc:aea:aejmac:v:14:y:2022:i:4:p:479-98
    DOI: 10.1257/mac.20200371
    as

    Download full text from publisher

    File URL: https://www.aeaweb.org/doi/10.1257/mac.20200371
    Download Restriction: no
    File URL: https://doi.org/10.3886/E140141V1
    Download Restriction: no
    File URL: https://www.aeaweb.org/doi/10.1257/mac.20200371.appx
    Download Restriction: no
    File URL: https://www.aeaweb.org/doi/10.1257/mac.20200371.ds
    Download Restriction: Access to full text is restricted to AEA members and institutional subscribers.
    File URL: https://libkey.io/10.1257/mac.20200371?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Other versions of this item:

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Cao, Huoqing & Chen, Shiyi & Xi, Xican, 2023. "Aging, migration, and structural transformation in China," Economic Modelling, Elsevier, vol. 126(C).
    2. Chen, Natalie & Novy, Dennis & Perroni, Carlo & Chern Wong, Horng, 2023. "Urban-Biased Structural Change," CAGE Online Working Paper Series 694, Competitive Advantage in the Global Economy (CAGE).
    3. Fernández-Villaverde, Jesús & Ventura, Gustavo & Yao, Wen, 2025. "The wealth of working nations," European Economic Review, Elsevier, vol. 173(C).
    4. Ngueuleweu Tiwang Gildas & Ningaye paul & Fon Dorothy Engwali, 2025. "Do demographic structure conditions sector contribution to economic growth? A machine learning approach," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 27(2), pages 2901-2941, February.
    5. Tian, Geran & Jin, Changlun & Wu, Weixing, 2024. "Too old to spend? Understanding the consumption of the elderly in China," China Economic Review, Elsevier, vol. 88(C).
    6. Chen, Shiyi & Li, Yunpeng & Sun, Qinzhu, 2025. "Population aging and innovation slowdown: Dual mechanisms of firm cost structure and consumption preference," Economic Modelling, Elsevier, vol. 150(C).
    7. Ichiro Fukunaga & Yoshihiko Hogen & Yojiro Ito & Kenji Kanai & Satoshi Tsuchida, 2024. "Potential Growth in Japan: Issues on Its Relationship with Prices and Wages," Bank of Japan Working Paper Series 24-E-16, Bank of Japan.
    8. Gaggl, Paul & Gray, Rowena & Marinescu, Ioana & Morin, Miguel, 2021. "Does electricity drive structural transformation? Evidence from the United States," Labour Economics, Elsevier, vol. 68(C).
    9. Kazuo Mino & Hiroaki Sasaki, 2023. "Population Aging and Income Inequality in a Semi-Endogenous Growth Model," KIER Working Papers 1096, Kyoto University, Institute of Economic Research.
    10. Mingzhi Zhang & Chao Chen & Xiangyu Zhou & Xinpei Wang & Bowen Wang & Fuying Huan & Jianxu Liu, 2024. "The impact of accelerating population aging on service industry development: Evidence from China," PLOS ONE, Public Library of Science, vol. 19(6), pages 1-22, June.
    11. Mauri Kotamaki & Jonne Lehtimaki, 2024. "Getting too old for this: Economic effects of ageing population in Finland," Discussion Papers 168, Aboa Centre for Economics.
    12. Zhou, Yang & Wang, Heng & Qiu, Huanguang, 2023. "Population aging reduces carbon emissions: Evidence from China's latest three censuses," Applied Energy, Elsevier, vol. 351(C).
    13. Tamai, Toshiki, 2023. "The rate of discount on public investments with future bias in an altruistic overlapping generations model," European Journal of Political Economy, Elsevier, vol. 79(C).
    14. Xiao, Fenghua & Wang, Jinbo & Li, Huijun & Yang, Juan, 2024. "Population aging and corporate human capital restructuring," Finance Research Letters, Elsevier, vol. 67(PA).
    15. Karel Brůna & Jiří Pour, 2023. "Population aging and structural over/underinvestment," Economic Change and Restructuring, Springer, vol. 56(4), pages 2339-2383, August.
    16. Hui Tian & Jiaqi Qin & Chaoyin Cheng & Sohail Ahmad Javeed & Tiansi Chu, 2024. "Towards low‐carbon sustainable development under Industry 4.0: The influence of industrial intelligence on China's carbon mitigation," Sustainable Development, John Wiley & Sons, Ltd., vol. 32(1), pages 455-480, February.
    17. Huang, Wei & Lei, Xiaoyan & Zhang, Chunfeng, 2025. "Green retirement: The impact of retirement on carbon emissions through consumption and income dynamics," Journal of Comparative Economics, Elsevier, vol. 53(3), pages 727-753.
    18. Ambrocio, Gene, 2023. "Demographic aging and the New Keynesian Phillips Curve," Bank of Finland Research Discussion Papers 16/2023, Bank of Finland.

    More about this item

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • E23 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Production
    • J11 - Labor and Demographic Economics - - Demographic Economics - - - Demographic Trends, Macroeconomic Effects, and Forecasts
    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:aea:aejmac:v:14:y:2022:i:4:p:479-98. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Michael P. Albert (email available below). General contact details of provider: https://edirc.repec.org/data/aeaaaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.