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Technology Adoption and Demographic Change

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  • Karsten Wasiluk

    (Department of Economics, University of Konstanz, Germany)

Abstract

This paper studies the effect of demographic change on the technology distribution of an economy and on aggregate productivity growth. In the quantitative dynamic model, firms decide on employment and the technology they use subject to an aging workforce. Firms with a higher share of elderly workers update their technology less often and prefer older technologies than firms with a younger workforce. The shorter expected worklife of elderly workers makes firms reluctant to train them for new technologies. I calibrate the model for the German economy and simulate the projected demographic change. The results indicate that labor force aging reduces the realized annual productivity growth rate by 0.28 percentage points between 2010–2025.

Suggested Citation

  • Karsten Wasiluk, 2014. "Technology Adoption and Demographic Change," Working Paper Series of the Department of Economics, University of Konstanz 2014-05, Department of Economics, University of Konstanz.
  • Handle: RePEc:knz:dpteco:1405
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    File URL: http://www.uni-konstanz.de/FuF/wiwi/workingpaperseries/WP_05_Wasiluk_2014.pdf
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    2. Park, Cyn-Young & Shin, Kwanho & Kikkawa, Aiko, 2022. "Demographic change, technological advance, and growth: A cross-country analysis," Economic Modelling, Elsevier, vol. 108(C).
    3. Altaf Hussain & Rosman Md Yusoff & Sajjad Ahmad Banoori & Anwar Khan & Muhammad Asad Khan, 2016. "Enhancing Effectiveness of Employees through Training and Development in the Health Care Department of Khyber Pakhtunkhwa Pakistan: A Literature Review," International Review of Management and Marketing, Econjournals, vol. 6(4), pages 731-737.
    4. P. C. Albuquerque, 2015. "Demographics and the Portuguese economic growth," Working Papers Department of Economics 2015/17, ISEG - Lisbon School of Economics and Management, Department of Economics, Universidade de Lisboa.
    5. Taehwan Rhee & Jacob Wood & Jungsuk Kim, 2022. "Digital Transformation as a Demographic and Economic Integrated Policy for Southeast Asian Developing Countries," Sustainability, MDPI, vol. 14(5), pages 1-19, March.
    6. Altaf Hussain & Rosman Md Yusoff & Sajjad Ahmad Banoori & Anwar Khan & Muhammad Asad Khan, 2016. "Enhancing Effectiveness of Employees through Training and Development in the Health Care Department of Khyber Pakhtunkhwa Pakistan: A Literature Review," International Review of Management and Marketing, Econjournals, vol. 6(4), pages 731-737.

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    More about this item

    Keywords

    Demographic Change; TFP growth; Retirement Policies;
    All these keywords.

    JEL classification:

    • J11 - Labor and Demographic Economics - - Demographic Economics - - - Demographic Trends, Macroeconomic Effects, and Forecasts
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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