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Does Age Structure Forecast Economic Growth?

  • David E. Bloom
  • David Canning
  • Günther Fink
  • Jocelyn E. Finlay

Increases in the proportion of the working age population can yield a "demographic dividend" that enhances the rate of economic growth. We estimate the parameters of an economic growth model with a cross section of countries over the period 1960 to 1980 and investigate whether the inclusion of age structure improves the model's forecasts for the period 1980 to 2000. We find that including age structure improves the forecast, although there is evidence of parameter instability between periods with an unexplained growth slowdown in the second period. We use the model to generate growth forecasts for the period 2000 to 2020.

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File URL: http://www.nber.org/papers/w13221.pdf
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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 13221.

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Date of creation: Jul 2007
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Publication status: published as Bloom, David E. & Canning, David & Fink, Gunther & Finlay, Jocelyn E., 2007. "Does age structure forecast economic growth?," International Journal of Forecasting, Elsevier, vol. 23(4), pages 569-585.
Handle: RePEc:nbr:nberwo:13221
Note: AG EFG HE LS PE
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