The Welfare State and the Demographic Dividend: A Cross-Country Comparison

UB Economics Working Papers E15/332

51 Pages Posted: 3 Dec 2015

See all articles by Gemma Abio

Gemma Abio

University of Barcelona

Concepcio Patxot

University of Barcelona - Department of Economic Theory

Miguel Sanchez

Wittgenstein Centre for Demography and Global Human Capital

Guadalupe Souto

Autonomous University of Barcelona

Date Written: November 23, 2015

Abstract

The sustainability of the welfare state is in doubt in many developed countries due to drastic population ageing. The extent of the problem and the margin for reforms depend - among other factors - on the size of the ageing process and the size of the public transfer system. The latter has a crucial impact on the extent to which the first demographic dividend previous to the ageing process turns into a second demographic dividend. The contribution of the different factors driving the demographic dividend is, ultimately, an empirical question. In this paper we contribute to the debate, exploding the cross-country comparison potentialities of the National Transfer Accounts (NTA) database. In particular, we introduce different configurations of the welfare state transfers – Sweden, United States and Spain - into a realistic demography Overlapping Generations (OLG) model and simulate its effects on the second demographic dividend.

Keywords: Ageing, demographic dividend, intergenerational transfers, national transfer accounts, overlapping generations model, welfare state

JEL Classification: J11, J18, E21, H53

Suggested Citation

Abio, Gemma and Patxot Cardoner, Concepcio and Sanchez, Miguel and Souto, Guadalupe, The Welfare State and the Demographic Dividend: A Cross-Country Comparison (November 23, 2015). UB Economics Working Papers E15/332. Available at SSRN: https://ssrn.com/abstract=2698124 or http://dx.doi.org/10.2139/ssrn.2698124

Gemma Abio (Contact Author)

University of Barcelona ( email )

Gran Via de les Corts Catalanes, 585
Barcelona, 08007
Spain

Concepcio Patxot Cardoner

University of Barcelona - Department of Economic Theory ( email )

Barcelona
Spain

Miguel Sanchez

Wittgenstein Centre for Demography and Global Human Capital ( email )

Nordbergstraße 15/A/6
Vienna, 1090
Austria

Guadalupe Souto

Autonomous University of Barcelona ( email )

Plaça Cívica
Cerdañola del Valles
Barcelona, Barcelona 08193
Spain

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