IDEAS home Printed from https://ideas.repec.org/p/mcm/deptwp/2018-04.html
   My bibliography  Save this paper

The Differential Effects of Population Aging on Provincial GDP per capita and the Role of Productivity Growth as a Possible offset

Author

Listed:
  • Frank T. Denton
  • Byron G. Spencer

Abstract

A shift in population distribution toward older ages is underway in industrialised countries throughout the world and will continue well into the future. We provide a framework for isolating the pure effects of population aging on per capita GDP, employ the framework in calculations for the ten provinces of Canada, and derive the rates of productivity growth required to offset those effects. For comparison, as possible alternative offsets, we consider also some changes relating to the supply of labour.

Suggested Citation

  • Frank T. Denton & Byron G. Spencer, 2018. "The Differential Effects of Population Aging on Provincial GDP per capita and the Role of Productivity Growth as a Possible offset," Department of Economics Working Papers 2018-04, McMaster University.
    • Handle: RePEc:mcm:deptwp:2018-04
    as

    Download full text from publisher

    File URL: http://socialsciences.mcmaster.ca/econ/rsrch/papers/archive/2018-04.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Robert J. Gordon, 2016. "The Rise and Fall of American Growth: The U.S. Standard of Living since the Civil War," Economics Books, Princeton University Press, edition 1, number 10544.
    2. David E. Bloom & David Canning & Günther Fink, 2010. "Implications of population ageing for economic growth," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 26(4), pages 583-612, Winter.
    3. Benoit Dostie, 2011. "Wages, Productivity and Aging," De Economist, Springer, vol. 159(2), pages 139-158, June.
    4. Nicole Maestas & Kathleen Mullen & David Powell, 2014. "The Effect of Population Aging on Economic Growth," Discussion Papers 14-012, Stanford Institute for Economic Policy Research.
    5. Jacob A. Mincer, 1974. "Introduction to "Schooling, Experience, and Earnings"," NBER Chapters, in: Schooling, Experience, and Earnings, pages 1-4, National Bureau of Economic Research, Inc.
    6. Nicole Maestas & Kathleen J. Mullen & David Powell, 2023. "The Effect of Population Aging on Economic Growth, the Labor Force, and Productivity," American Economic Journal: Macroeconomics, American Economic Association, vol. 15(2), pages 306-332, April.
    7. Judith K. Hellerstein & David Neumark, 2007. "Production Function and Wage Equation Estimation with Heterogeneous Labor: Evidence from a New Matched Employer-Employee Data Set," NBER Chapters, in: Hard-to-Measure Goods and Services: Essays in Honor of Zvi Griliches, pages 31-71, National Bureau of Economic Research, Inc.
    8. Jan Ours & Lenny Stoeldraijer, 2011. "Age, Wage and Productivity in Dutch Manufacturing," De Economist, Springer, vol. 159(2), pages 113-137, June.
    9. Frank T. Denton & Byron G. Spencer, 1981. "A Macro-Economic Analysis of the Effects of a Public Pension Plan," Canadian Journal of Economics, Canadian Economics Association, vol. 14(4), pages 609-634, November.
    10. Daron Acemoglu & Pascual Restrepo, 2017. "Secular Stagnation? The Effect of Aging on Economic Growth in the Age of Automation," American Economic Review, American Economic Association, vol. 107(5), pages 174-179, May.
    11. Jacob A. Mincer, 1974. "Schooling and Earnings," NBER Chapters, in: Schooling, Experience, and Earnings, pages 41-63, National Bureau of Economic Research, Inc.
    12. Jacob A. Mincer, 1974. "Schooling, Experience, and Earnings," NBER Books, National Bureau of Economic Research, Inc, number minc74-1.
    13. Nicole Maestas & Kathleen J. Mullen & David Powell, 2016. "The Effect of Population Aging on Economic Growth, the Labor Force and Productivity," NBER Working Papers 22452, National Bureau of Economic Research, Inc.
    14. Bruno Crépon & Nicolas Deniau & Sébastien Perez-Duarte, 2003. "Productivité et salaire des travailleurs âgés," Revue Française d'Économie, Programme National Persée, vol. 18(1), pages 157-185.
    15. Frank T. Denton & Byron G. Spencer, 2017. "What Rates Of Productivity Growth Would Be Required To Offset The Effects Of Population Aging? A Study Of Twenty Industrialised Countries," Department of Economics Working Papers 2017-08, McMaster University.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Frank T. Denton & Byron G. Spencer, 2017. "What Rates Of Productivity Growth Would Be Required To Offset The Effects Of Population Aging? A Study Of Twenty Industrialised Countries," Department of Economics Working Papers 2017-08, McMaster University.
    2. Kim, Hoolda & Song Lee, Bun, 2023. "Aging workforce, wages, and productivity: Do older workers drag productivity down in Korea?," The Journal of the Economics of Ageing, Elsevier, vol. 24(C).
    3. Christian Pfeifer & Joachim Wagner, 2014. "Age and gender effects of workforce composition on productivity and profits: Evidence from a new type of data for German enterprises," Contemporary Economics, University of Economics and Human Sciences in Warsaw., vol. 8(1), March.
    4. Iñigo Calvo-Sotomayor & Ekhi Atutxa & Ricardo Aguado, 2020. "Who Is Afraid of Population Aging? Myths, Challenges and an Open Question from the Civil Economy Perspective," IJERPH, MDPI, vol. 17(15), pages 1-17, July.
    5. Van Biesebroeck, Johannes, 2011. "Wages Equal Productivity. Fact or Fiction? Evidence from Sub Saharan Africa," World Development, Elsevier, vol. 39(8), pages 1333-1346, August.
    6. Valentine Jacobs & Kevin Pineda-Hernández & François Rycx & Mélanie Volral, 2023. "Does over-education raise productivity and wages equally? The moderating role of workers’ origin and immigrants’ background," Education Economics, Taylor & Francis Journals, vol. 31(6), pages 698-724, November.
    7. Giuseppe Croce & Andrea Ricci & Giuliana Tesauro, 2019. "Pensions reforms, workforce ageing and firm-provided welfare," Applied Economics, Taylor & Francis Journals, vol. 51(32), pages 3480-3497, July.
    8. Bernhard Mahlberg & Inga Freund & Alexia Prskawetz, 2013. "Ageing, productivity and wages in Austria: sector level evidence," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 40(4), pages 561-584, November.
    9. Alessandra Cataldi & Stephan Kampelmann & François Rycx, 2012. "Does it pay to be productive? The case of age groups," International Journal of Manpower, Emerald Group Publishing Limited, vol. 33(3), pages 264-283, June.
    10. Beatriz Muriel Hernández, 2016. "An Analysis of Firm Characteristics as Earnings Determinants: The Urban Bolivia Case," Development Research Working Paper Series 04/2016, Institute for Advanced Development Studies.
    11. Thierry Lallemand & François Rycx, 2009. "Are young and old workers harmful for firm productivity?," DULBEA Working Papers 09-02.RS, ULB -- Universite Libre de Bruxelles.
    12. Majchrowska Aleksandra & Broniatowska Paulina, 2018. "The workforce’s age structure and wages—Do age and the type of occupation matter?," Lodz Economics Working Papers 8/2018, University of Lodz, Faculty of Economics and Sociology.
    13. Paulina Broniatowska & Aleksandra Majchrowska & Maciej Nasiński, 2020. "Age Structure of Employment and Wages. An Analysis Across Occupational Groups," Central European Journal of Economic Modelling and Econometrics, Central European Journal of Economic Modelling and Econometrics, vol. 12(3), pages 227-250, September.
    14. Alessandra Cataldi & Stephan Kampelmann & François Rycx, 2011. "Productivity-Wage Gaps Among Age Groups: Does the ICT Environment Matter?," De Economist, Springer, vol. 159(2), pages 193-221, June.
    15. Kadija Charni & Stephen Bazen, 2017. "Do earnings really decline for older workers?," International Journal of Manpower, Emerald Group Publishing Limited, vol. 38(1), pages 4-24, April.
    16. Elżbieta Stępień, 2009. "The Impact of International Trade and Foreign Competition on Labour Earnings in Poland," Ekonomia journal, Faculty of Economic Sciences, University of Warsaw, vol. 24.
    17. Casper Worm Hansen & Holger Strulik, 2017. "Life expectancy and education: evidence from the cardiovascular revolution," Journal of Economic Growth, Springer, vol. 22(4), pages 421-450, December.
    18. Kodama, Naomi & Odaki, Kazuhiko, 2013. "Measuring the Gap between Wage and Productivity: Wage-Tenure Profile and Productivity-Tenure Profile Cross Twice," CIS Discussion paper series 612, Center for Intergenerational Studies, Institute of Economic Research, Hitotsubashi University.
    19. Prettner, Klaus & Bloom, David E. & Strulik, Holger, 2013. "Declining fertility and economic well-being: Do education and health ride to the rescue?," Labour Economics, Elsevier, vol. 22(C), pages 70-79.
    20. Mamun, Shamsul Arifeen Khan & Rahman, Mohammad Mafizur & Khanam, Rasheda, 2020. "The relation between an ageing population and economic growth in Bangladesh: Evidence from an endogenous growth model," Economic Analysis and Policy, Elsevier, vol. 66(C), pages 14-25.

    More about this item

    JEL classification:

    • J1 - Labor and Demographic Economics - - Demographic Economics
    • J11 - Labor and Demographic Economics - - Demographic Economics - - - Demographic Trends, Macroeconomic Effects, and Forecasts
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:mcm:deptwp:2018-04. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/demcmca.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.