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Population Aging and Structural Transformation

Author

Listed:
  • Javier Cravino
  • Andrei A. Levchenko
  • Marco Rojas

Abstract

We quantify the role of population aging in the structural transformation process. Household-level data from the U.S. show that the fraction of expenditures devoted to services increases with household age. We use a shift-share decomposition and a quantitative model to show that U.S. population aging accounted for about a fifth of the observed increase in the service share in consumption between 1982 and 2016. The contribution of population aging to the rise in the service share is about the same size as the contribution of real income growth, and about half as large as that of changes in relative prices.

Suggested Citation

  • Javier Cravino & Andrei A. Levchenko & Marco Rojas, 2019. "Population Aging and Structural Transformation," NBER Working Papers 26327, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:26327
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    References listed on IDEAS

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    Cited by:

    1. Jesús Fernández-Villaverde & Gustavo Ventura & Wen Yao, 2023. "The Wealth of Working Nations," NBER Working Papers 31914, National Bureau of Economic Research, Inc.
    2. Zhou, Yang & Wang, Heng & Qiu, Huanguang, 2023. "Population aging reduces carbon emissions: Evidence from China's latest three censuses," Applied Energy, Elsevier, vol. 351(C).
    3. Chen, Natalie & Novy, Dennis & Perroni, Carlo & Wong, Horng Chern, 2023. "Urban-biased structural change," LSE Research Online Documents on Economics 121286, London School of Economics and Political Science, LSE Library.
    4. Tamai, Toshiki, 2023. "The rate of discount on public investments with future bias in an altruistic overlapping generations model," European Journal of Political Economy, Elsevier, vol. 79(C).
    5. Gaggl, Paul & Gray, Rowena & Marinescu, Ioana & Morin, Miguel, 2021. "Does electricity drive structural transformation? Evidence from the United States," Labour Economics, Elsevier, vol. 68(C).
    6. Ambrocio, Gene, 2023. "Demographic aging and the New Keynesian Phillips Curve," Bank of Finland Research Discussion Papers 16/2023, Bank of Finland.
    7. Cao, Huoqing & Chen, Shiyi & Xi, Xican, 2023. "Aging, migration, and structural transformation in China," Economic Modelling, Elsevier, vol. 126(C).
    8. Kazuo Mino & Hiroaki Sasaki, 2023. "Population Aging and Income Inequality in a Semi-Endogenous Growth Model," KIER Working Papers 1096, Kyoto University, Institute of Economic Research.
    9. Karel Brůna & Jiří Pour, 2023. "Population aging and structural over/underinvestment," Economic Change and Restructuring, Springer, vol. 56(4), pages 2339-2383, August.

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    More about this item

    JEL classification:

    • E2 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity

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