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Does Aging Influence Sectoral Employment Shares?: Evidence from Panel Data

  • Ulrich Thießen
  • Konstantin A. Kholodilin
  • Boriss Siliverstovs

In this study, we investigate whether population aging influences employment shares in different economic sectors. To this end, we employ dynamic panel data analysis. Our unbalanced data set comprises 54 countries and extends to a maximum time period from 1970 till 2004. Our results suggest that the aging variable - approximated by the ratio of elderly either to the total population or to the labor force - does have a statistically significant differentiated impact on the employment shares when controlling for other relevant factors, e.g., income per capita, share of trade in GDP, government consumption share in GDP, population size, etc. In particular, we find that an increase in the aging proxies exerts a statistically significant adverse effect on the employment shares in agriculture, manufacturing, construction, and mining and quarrying industries. At the same time, increasing share of the elderly people in the society positively affects employment shares in community, social, and personal services as well as in the financial sector. In the simulation exercise, we illustrate the effects of aging on the employment structure within the next 45 years.

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File URL: http://www.diw.de/documents/publikationen/73/diw_01.c.82270.de/dp785.pdf
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Paper provided by DIW Berlin, German Institute for Economic Research in its series Discussion Papers of DIW Berlin with number 785.

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Length: 18 p.
Date of creation: 2008
Date of revision:
Handle: RePEc:diw:diwwpp:dp785
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  1. Frank T. Denton & Byron G. Spencer, 1998. "Economic Costs of Population Aging," Quantitative Studies in Economics and Population Research Reports 339, McMaster University.
  2. Alexander Ludwig & Joachim Winter, 2003. "Aging, pension reform, and capital flows: A multi-country simulation model," MEA discussion paper series 03028, Munich Center for the Economics of Aging (MEA) at the Max Planck Institute for Social Law and Social Policy.
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  9. Badi H. Baltagi & James M. Griffin & Weiwen Xiong, 2000. "To Pool Or Not To Pool: Homogeneous Versus Hetergeneous Estimations Applied to Cigarette Demand," The Review of Economics and Statistics, MIT Press, vol. 82(1), pages 117-126, February.
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  14. Joaquim Oliveira Martins & Frédéric Gonand & Pablo Antolín & Christine de la Maisonneuve & Kwang-Yeol Yoo, 2005. "The Impact of Ageing on Demand, Factor Markets and Growth," OECD Economics Department Working Papers 420, OECD Publishing.
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