IDEAS home Printed from https://ideas.repec.org/p/nbp/nbpmis/281.html
   My bibliography  Save this paper

Macroeconomic consequences of the demographic and educational transition in Poland

Author

Listed:
  • Aleksandra Kolasa

    (University of Warsaw)

Abstract

Soon after the start of the transition to market economy in the early 1990s, Poland has experienced both a dramatic decline in the fertility rate and an increase in the share of students among young high-school graduates. These two processes significantly changed the age structure of the population and average income characteristics of households. Using a general equilibrium model with heterogeneous households and uninsured income shocks I try to assess the impact of these demographic and educational changes on the Polish economic performance and inequalities. I find that in the long term the positive effects of educational transition on output per capita more than offset the negative impact of lower fertility, but the outcome strongly depends on the adjustments in the structure of labor demand. I also show that the educational transition increases income and consumption inequalities, while the demographic transition decreases inequality in assets.

Suggested Citation

  • Aleksandra Kolasa, 2018. "Macroeconomic consequences of the demographic and educational transition in Poland," NBP Working Papers 281, Narodowy Bank Polski.
  • Handle: RePEc:nbp:nbpmis:281
    Note: This paper benefited from comments by Ryszard Kokoszczyński, Marcin Kolasa, Anna Nicińska, Małgorzata Rószkiewicz, Michał Rubaszek, Małgorzata Skibińska, Joanna Wolszczak-Derlacz, an anonymous referee and participants of the 5th NBP Summer Workshop in Warsaw.
    as

    Download full text from publisher

    File URL: https://static.nbp.pl/publikacje/materialy-i-studia/281_en.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Schmitt-Grohe, Stephanie & Uribe, Martin, 2003. "Closing small open economy models," Journal of International Economics, Elsevier, vol. 61(1), pages 163-185, October.
    2. Michele Catalano & Emilia Pezzolla, 2016. "The effects of education and aging in an OLG model: long-run growth in France, Germany and Italy," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 43(4), pages 757-800, November.
    3. Carvalho, Carlos & Ferrero, Andrea & Nechio, Fernanda, 2016. "Demographics and real interest rates: Inspecting the mechanism," European Economic Review, Elsevier, vol. 88(C), pages 208-226.
    4. Krueger, Dirk & Ludwig, Alexander, 2007. "On the consequences of demographic change for rates of returns to capital, and the distribution of wealth and welfare," Journal of Monetary Economics, Elsevier, vol. 54(1), pages 49-87, January.
    5. Jacob A. Mincer, 1974. "Schooling, Experience, and Earnings," NBER Books, National Bureau of Economic Research, Inc, number minc74-1.
    6. S. Rao Aiyagari, 1994. "Uninsured Idiosyncratic Risk and Aggregate Saving," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 109(3), pages 659-684.
    7. Claude Diebolt & Audrey-Rose Menard & Faustine Perrin, 2017. "Behind the fertility–education nexus: what triggered the French development process?," European Review of Economic History, European Historical Economics Society, vol. 21(4), pages 357-392.
    8. Sandra E. Black & Paul J. Devereux & Kjell G. Salvanes, 2005. "Why the Apple Doesn't Fall Far: Understanding Intergenerational Transmission of Human Capital," American Economic Review, American Economic Association, vol. 95(1), pages 437-449, March.
    9. Gianmarco I. P. Ottaviano & Giovanni Peri, 2021. "Rethinking The Effect Of Immigration On Wages," World Scientific Book Chapters, in: Firms and Workers in a Globalized World Larger Markets, Tougher Competition, chapter 9, pages 245-290, World Scientific Publishing Co. Pte. Ltd..
    10. Jacob A. Mincer, 1974. "Schooling and Earnings," NBER Chapters, in: Schooling, Experience, and Earnings, pages 41-63, National Bureau of Economic Research, Inc.
    11. Alexander Ludwig & Thomas Schelkle & Edgar Vogel, 2012. "Demographic Change, Human Capital and Welfare," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 15(1), pages 94-107, January.
    12. Francesco Caselli & Wilbur John Coleman II, 2006. "The World Technology Frontier," American Economic Review, American Economic Association, vol. 96(3), pages 499-522, June.
    13. Kjetil Storesletten, 2000. "Sustaining Fiscal Policy through Immigration," Journal of Political Economy, University of Chicago Press, vol. 108(2), pages 300-323, April.
    14. Pierre-Olivier Gourinchas & Jonathan A. Parker, 2002. "Consumption Over the Life Cycle," Econometrica, Econometric Society, vol. 70(1), pages 47-89, January.
    15. Robert G. Valletta, 2018. "Recent Flattening in the Higher Education Wage Premium: Polarization, Skill Downgrading, or Both?," NBER Chapters, in: Education, Skills, and Technical Change: Implications for Future US GDP Growth, pages 313-342, National Bureau of Economic Research, Inc.
    16. Aleksandra Kolasa, 2017. "Life Cycle Income and Consumption Patterns in Poland," Central European Journal of Economic Modelling and Econometrics, Central European Journal of Economic Modelling and Econometrics, vol. 9(2), pages 137-172, June.
    17. Nishiyama, Shinichi, 2015. "Fiscal policy effects in a heterogeneous-agent OLG economy with an aging population," Journal of Economic Dynamics and Control, Elsevier, vol. 61(C), pages 114-132.
    18. Walker, Ian & Zhu, Yu, 2005. "The College Wage Premium, Overeducation, and the Expansion of Higher Education in the UK," IZA Discussion Papers 1627, Institute of Labor Economics (IZA).
    19. 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.
    20. Keane, Michael P. & Prasad, Eswar S., 2006. "Changes in the structure of earnings during the Polish transition," Journal of Development Economics, Elsevier, vol. 80(2), pages 389-427, August.
    21. Michał Rubaszek, 2012. "Mortgage down-payment and welfare in a life-cycle model," Bank i Kredyt, Narodowy Bank Polski, vol. 43(4), pages 5-28.
    22. Jan Hagemejer & Krzysztof Makarski & Joanna Tyrowicz, 2015. "Unprivatizing the pension system: the case of Poland," Applied Economics, Taylor & Francis Journals, vol. 47(8), pages 833-852, February.
    23. Tauchen, George & Hussey, Robert, 1991. "Quadrature-Based Methods for Obtaining Approximate Solutions to Nonlinear Asset Pricing Models," Econometrica, Econometric Society, vol. 59(2), pages 371-396, March.
    24. Makarski, Krzysztof & Hagemejer, Jan & Tyrowicz, Joanna, 2017. "Analyzing The Efficiency Of Pension Reform: The Role Of The Welfare Effects Of Fiscal Closures," Macroeconomic Dynamics, Cambridge University Press, vol. 21(5), pages 1205-1234, July.
    25. Hubbard, R Glenn & Judd, Kenneth L, 1987. "Social Security and Individual Welfare: Precautionary Saving, Borrowing Constraints, and the Payroll Tax," American Economic Review, American Economic Association, vol. 77(4), pages 630-646, September.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Małgorzata Walerych, 2024. "The aggregate and redistributive effects of emigration," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 160(1), pages 99-143, February.

    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. Aleksandra Kolasa, 2022. "The long-term impact of quasi-universal transfers to older households," Working Papers 2022-28, Faculty of Economic Sciences, University of Warsaw.
    2. repec:ecb:ecbops:2014165 is not listed on IDEAS
    3. Dieppe, Alistair & Mourinho Félix, Ricardo & Marchiori, Luca & Grech, Owen & Albani, Maria & Lalouette, Laure & Kulikov, Dmitry & Papadopoulou, Niki & Sideris, Dimitris & Irac, Delphine & Gordo Mora, , 2015. "Public debt, population ageing and medium-term growth," Occasional Paper Series 165, European Central Bank.
    4. Pritha Dev & Blessing U. Mberu & Roland Pongou, 2016. "Ethnic Inequality: Theory and Evidence from Formal Education in Nigeria," Economic Development and Cultural Change, University of Chicago Press, vol. 64(4), pages 603-660.
    5. Berger, Johannes & Strohner, Ludwig, 2020. "Documentation of the PUblic Policy Model for Austria and other European countries (PUMA)," Research Papers 11, EcoAustria – Institute for Economic Research.
    6. Flabbi, Luca & Paternostro, Stefano & Tiongson, Erwin R., 2008. "Returns to education in the economic transition: A systematic assessment using comparable data," Economics of Education Review, Elsevier, vol. 27(6), pages 724-740, December.
    7. David Card & Ana Rute Cardoso & Joerg Heining & Patrick Kline, 2018. "Firms and Labor Market Inequality: Evidence and Some Theory," Journal of Labor Economics, University of Chicago Press, vol. 36(S1), pages 13-70.
    8. Huggett, Mark & Ventura, Gustavo & Yaron, Amir, 2006. "Human capital and earnings distribution dynamics," Journal of Monetary Economics, Elsevier, vol. 53(2), pages 265-290, March.
    9. Emilia Bedyk & Jacek Liwiński, 2016. "The wage premium from parents’ investments in the education of their children in Poland," Working Papers 2016-14, Faculty of Economic Sciences, University of Warsaw.
    10. Michele Catalano & Emilia Pezzolla, 2022. "Global natural projections," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 49(4), pages 949-990, November.
    11. repec:diw:diwwpp:dp1514 is not listed on IDEAS
    12. Blundell, Richard & Graber, Michael & Mogstad, Magne, 2015. "Labor income dynamics and the insurance from taxes, transfers, and the family," Journal of Public Economics, Elsevier, vol. 127(C), pages 58-73.
    13. Cunha, Flavio & Heckman, James J., 2007. "Identifying and Estimating the Distributions of Ex Post and Ex Ante Returns to Schooling," Labour Economics, Elsevier, vol. 14(6), pages 870-893, December.
    14. Konstantinos Angelopoulos & Spyridon Lazarakis & James Malley, 2017. "Wealth inequality and externalities from ex ante skill heterogeneity," Working Papers 2017_07, Business School - Economics, University of Glasgow.
    15. Fatih Guvenen, 2007. "Learning Your Earning: Are Labor Income Shocks Really Very Persistent?," American Economic Review, American Economic Association, vol. 97(3), pages 687-712, June.
    16. Woodland, A., 2016. "Taxation, Pensions, and Demographic Change," Handbook of the Economics of Population Aging, in: Piggott, John & Woodland, Alan (ed.), Handbook of the Economics of Population Aging, edition 1, volume 1, chapter 0, pages 713-780, Elsevier.
    17. Beetsma, Roel & Komada, Oliwia & Makarski, Krzysztof & Tyrowicz, Joanna, 2021. "The political (in)stability of funded social security," Journal of Economic Dynamics and Control, Elsevier, vol. 133(C).
    18. Necker, Sarah & Voskort, Andrea, 2014. "Intergenerational transmission of risk attitudes – A revealed preference approach," European Economic Review, Elsevier, vol. 65(C), pages 66-89.
    19. Gustavsson, Magnus & Österholm, Pär, 2014. "Does the labor-income process contain a unit root? Evidence from individual-specific time series," Journal of Economic Dynamics and Control, Elsevier, vol. 47(C), pages 152-167.
    20. Dev, Pritha & Mberu, Blessing & Pongou, Roland, 2013. "Communitarianism, Oppositional Cultures, and Human Capital Contagion: Theory and Evidence from Formal versus Koranic Education," MPRA Paper 46234, University Library of Munich, Germany, revised 15 Apr 2013.
    21. Felicia Ionescu, 2009. "The Federal Student Loan Program: Quantitative Implications for College Enrollment and Default Rates," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 12(1), pages 205-231, January.
    22. Ali Ozdagli & Nicholas Trachter, 2011. "On the distribution of college dropouts: household wealth and uninsurable idiosyncratic risk," Working Papers 11-8, Federal Reserve Bank of Boston.

    More about this item

    Keywords

    population aging; educational transition; inequalities; models with heterogeneous agents;
    All these keywords.

    JEL classification:

    • J11 - Labor and Demographic Economics - - Demographic Economics - - - Demographic Trends, Macroeconomic Effects, and Forecasts
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • I24 - Health, Education, and Welfare - - Education - - - Education and Inequality
    • D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
    • J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies

    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:nbp:nbpmis:281. 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: Jakub Growiec (email available below). General contact details of provider: https://edirc.repec.org/data/nbpgvpl.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.