Does Population Aging Drive Up Pro-Elderly Social Spending?

Abstract

This essay reviews recent evidence on the pro-elderly social spending bias of OECD welfare states. It shows that the cross-national variance in this variable is remarkably large, with Southern Europe and countries such as Germany, Austria, Japan, the USA, and Switzerland being most heavily pro-elderly biased. It then points out that population ageing actually cannot explain very much of this pro-elderly bias variance. For instance, countries such as Denmark, Finland and Sweden are demographically old societies, yet they boast among the lowest pro-elderly spending biases in the OECD world, due to their greater commitment to family-friendly policies, active labour market policies and similar pro-young policies. The essay reviews a series of similarly counter-intuitive findings about generational politics and policies as published in Ageing Populations in Post-Industrial Democracies (Vanhuysse and Goerres, 2012) and makes a plea for institutionally and historically richly informed explanations of the political consequences and the policy feedback effects arising from population ageing.

Keywords: generational politics, old and young, gerontocracy, demographic change, political sociology, welfare states, public policy