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From Demographic Dividend to Demographic Burden: The Impact of Population Ageing on Economic Growth in Europe

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  • Nicole Van Der Gaag
  • Joop Beer

Abstract

In the coming years, the share of the working-age population in the total population will start to decline in all countries of the European Union. All other things remaining equal, this so-called demographic burden will have a downward effect on economic growth. This paper examines whether the Europe 2020 employment targets would be sufficient to compensate for the downward impact of demographic burden and whether the impact of demography on economic growth differs between EU countries and between urban and rural regions. The results show that raising employment rates to the Europe 2020 targets can restore positive opportunities for economic growth, but not in all countries and only to a limited extent. They also show that even though urban and rural regions differ in terms of population growth and growth of the working age population, the prospects for demographic burden are highly similar for both types of regions.

Suggested Citation

  • Nicole Van Der Gaag & Joop Beer, 2015. "From Demographic Dividend to Demographic Burden: The Impact of Population Ageing on Economic Growth in Europe," Tijdschrift voor Economische en Sociale Geografie, Royal Dutch Geographical Society KNAG, vol. 106(1), pages 94-109, February.
  • Handle: RePEc:bla:tvecsg:v:106:y:2015:i:1:p:94-109
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    File URL: http://hdl.handle.net/10.1111/tesg.12104
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    References listed on IDEAS

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    1. Frank T. Denton & Byron G. Spencer, 1997. "Population, Labour Force, and Long-term Economic Growth," Independence and Economic Security of the Older Population Research Papers 25, McMaster University.
    2. Bart van Ark & Vivian Chen & Kirsten Jäger, 2013. "European Productivity Growth Since 2000 and Future Prospects," International Productivity Monitor, Centre for the Study of Living Standards, vol. 25, pages 65-83, Spring.
    3. Bucci, Alberto, 2008. "Population growth in a model of economic growth with human capital accumulation and horizontal R&D," Journal of Macroeconomics, Elsevier, vol. 30(3), pages 1124-1147, September.
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