Gonzalez-Eiras, Martin & Niepelt, Dirk.
Should developed countries raise their retirement ages to combat the economic effects of their ageing populations? This column presents a model suggesting that, viewed in isolation, putting off retirement will actually reduce growth. It is only when viewed along with other policies that the benefits for growth arise.
The prospect of “greying” populations in many developed economies is raising concerns about the sustainability of economic growth. According to these concerns, rising old-age dependency ratios translate into growing tax burdens while generous pension and healthcare benefits crowd out public investment spending for infrastructure or education, with negative effects for capital accumulation and productivity growth. Policymakers have already moved in response, with the EU launching its “Europe 2020” proposal calling for measures conducive to overcoming these challenges (see, for example, Council of the EU 2010).
Πηγή: Voxeu