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The importance of being mature: the effect of demographic maturation on global per capita GDP

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  • Rafael Gómez
  • Pablo Hernández de Cos

Abstract

Given that savings behaviour and worker productivity have strong life-cycle components and given that demographic profiles vary across countries, population age structure should be linked to differences in levels of economic development. In this paper we measure the economic importance of age structure variation for the global economy. We find that even after adjusting for country-specific effects, demographic maturation has been associated with nearly half of the evolution of global per-capita GDP since 1960. We also find that age structure differences can account for just over half of the variation in worldwide per capita GDP (i.e. the lack of sigma convergence) observed since 1960. Taken as a whole, these results complement recent theoretical and empirical work on the importance of population size and economic development and reinforce empirical work linking mature demographic age structures with faster cross-country economic growth rates. JEL Classification: J13, J22, J24, O11, O40
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  • Rafael Gómez & Pablo Hernández de Cos, 2008. "The importance of being mature: the effect of demographic maturation on global per capita GDP," Journal of Population Economics, Springer;European Society for Population Economics, vol. 21(3), pages 589-608, July.
    • Handle: RePEc:spr:jopoec:v:21:y:2008:i:3:p:589-608
    DOI: 10.1007/s00148-006-0107-6
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    More about this item

    Keywords

    Age structure; Life-cycle model; Cross-country growth; J13; J24; O40;
    All these keywords.

    JEL classification:

    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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