Mitigating the Economic Impact of an Aging Population: Options for Bulgaria

Mitigating the Economic Impact of an Aging Population: Options for Bulgaria, World Bank, September 2013

132 Pages Posted: 29 Sep 2013

See all articles by Dorte Domeland

Dorte Domeland

World Bank

Johannes Koettl

World Bank - Human Development Sector; IZA Institute of Labor Economics

Anna Katharina Raggl

Vienna University of Economics and Business; Wittgenstein Centre for Demography and Global Human Capital

Stella Ilieva

World Bank

Samuel Munzele Maimbo

WORLD BANK GROUP; University of Manchester

Olga Kupets

Kyiv School of Economics

Mohamed Ihsan Ajwad

World Bank - Human Development

Plamen Danchev

World Bank, Human Development

Joost de Laat

The World Bank - Strategic Impact Evaluation Fund (SIEF)

Carolin Geginat

World Bank

Zeljko Bogetic

World Bank

Igor Kheyfets

World Bank, Human Development

Agnes Couffinhal

World Bank

Antonia Dimova Antonova

Independent

M. Abels

Independent

Harun Onder

World Bank

Eduardo Ley

World Bank

Desislava Dimitrova

Independent

Asta Zviniene

Human Development

Pierre Pestieau

University of Liege - Research Center on Public and Population Economics; Centre for Economic Policy Research (CEPR); CESifo (Center for Economic Studies and Ifo Institute); Catholic University of Louvain (UCL) - Center for Operations Research and Econometrics (CORE)

Samir C.

University of Vienna

Date Written: September 18, 2013

Abstract

Bulgaria is undergoing a profound socio-economic transformation brought about by extraordinary demographic change. Between 1950 and 1990, Bulgaria’s population grew from 7.3 million to 8.8 million and then declined to 7.5 million by 2010. Low birth rates and high mortality rates combined with an emigration rate of 40 percent explain the steep decline. This radically changed Bulgaria’s age structure, resulting in the third-highest median age in the EU, surpassed only by Germany and Italy.

As a result, Bulgaria is now heading for the steepest decline in working-aging population of any country. Until 2007, Bulgaria’s working-age population grew relative to the total population and constituted its largest share. The subsequent decline has meant that fewer and fewer working Bulgarians will have to support more and more children and especially people over 64. By 2050, one in three Bulgarians is projected to be older than 65 and only one in two Bulgarians will be of working-age. This report analyzes the economic impact of ageing, focusing on budgetary, social (education and health), labor, and growth effects. The objective is to quantify, to the extent possible, realistic and alternative impact scenarios depending on various policy options available to Bulgarian policymakers. The sectoral impact analyses were combined into a consistent overall, long-term projection of Bulgaria’s public finances in order to highlight key policy trade-offs.

Keywords: Aging, Population, Economic Growth, Fiscal Policy, Balkans, Bulgaria

JEL Classification: J1, O5, P3

Suggested Citation

Domeland, Dorte and Koettl, Johannes and Raggl, Anna Katharina and Ilieva, Stella and Maimbo, Samuel Munzele and Kupets, Olga and Ajwad, Mohamed Ihsan and Danchev, Plamen and de Laat, Joost and Geginat, Carolin and Bogetic, Zeljko and Kheyfets, Igor and Couffinhal, Agnes and Antonova, Antonia Dimova and Abels, M. and Onder, Harun and Ley, Eduardo and Dimitrova, Desislava and Zviniene, Asta and Pestieau, Pierre and C., Samir, Mitigating the Economic Impact of an Aging Population: Options for Bulgaria (September 18, 2013). Mitigating the Economic Impact of an Aging Population: Options for Bulgaria, World Bank, September 2013. Available at SSRN: https://ssrn.com/abstract=2327847

Dorte Domeland (Contact Author)

World Bank ( email )

1818 H Street, NW
Washington, DC 20433
United States

Johannes Koettl

World Bank - Human Development Sector ( email )

1818 H Street, N.W.
Washington, DC 20433
United States

IZA Institute of Labor Economics ( email )

P.O. Box 7240
Bonn, D-53072
Germany

Anna Katharina Raggl

Vienna University of Economics and Business ( email )

Welthandelsplatz 1
Vienna, 1020
Austria

Wittgenstein Centre for Demography and Global Human Capital ( email )

Nordbergstraße 15/A/6
Vienna, 1090
Austria

Stella Ilieva

World Bank ( email )

1818 H Street, NW
Washington, DC 20433
United States

Samuel Munzele Maimbo

WORLD BANK GROUP ( email )

1818 H Street
Washington, DC D.C 20433
United States

University of Manchester ( email )

Manchester
Manchester
United Kingdom

Olga Kupets

Kyiv School of Economics ( email )

vul. Yakira, 13, 3d floor, suite 334
Kyiv, 04119
Ukraine

Mohamed Ihsan Ajwad

World Bank - Human Development ( email )

1818 H Street, N.W.
Washington, DC 20433
United States
202-473-7861 (Phone)

Plamen Danchev

World Bank, Human Development ( email )

1818 H Street, NW
Washington, DC 20433
United States

Joost De Laat

The World Bank - Strategic Impact Evaluation Fund (SIEF) ( email )

United States

HOME PAGE: http://www.worldbank.org/sief

Carolin Geginat

World Bank ( email )

1818 H Street, NW
Washington, DC 20433
United States

Zeljko Bogetic

World Bank ( email )

1818 H Street, N.W.
Washington, DC 20433
United States

Igor Kheyfets

World Bank, Human Development ( email )

1818 H Street, NW
Washington, DC 20433
United States

Agnes Couffinhal

World Bank ( email )

1818 H Street, NW
Washington, DC 20433
United States

Antonia Dimova Antonova

Independent ( email )

No Address Available

M. Abels

Independent ( email )

No Address Available

Harun Onder

World Bank ( email )

1818 H Street, NW
Washington, DC 20433
United States

Eduardo Ley

World Bank ( email )

1818 H Street, NW
Washington, DC 20433
United States

HOME PAGE: http://eWorldNet.org

Desislava Dimitrova

Independent ( email )

No Address Available

Asta Zviniene

Human Development ( email )

1818 H Street, NW
Washington, DC 20433
United States

Pierre Pestieau

University of Liege - Research Center on Public and Population Economics ( email )

Boulevard du Rectorat, 7, Batiment 31
Sart-Tilman
B-4000 Liege, 4000
Belgium
+32 4 366 3108 (Phone)
+32 4 366 3106 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

HOME PAGE: http://www.CESifo.de

Catholic University of Louvain (UCL) - Center for Operations Research and Econometrics (CORE) ( email )

34 Vopie Roman Pays
Louvain la Neuve
Belgium

Samir C.

University of Vienna ( email )

Bruenner Strasse 72
Vienna, Vienna 1090
Austria

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