Demographics and Interest Rates in Asia

24 Pages Posted: 22 Aug 2018

See all articles by Serkan Arslanalp

Serkan Arslanalp

International Monetary Fund (IMF)

Jaewoo Lee

International Monetary Fund (IMF) - Research Department

Umang Rawat

International Monetary Fund (IMF)

Date Written: July 2018

Abstract

Demographic developments have been regarded as one important cause of the long-termmovement in global interest rates. This paper provides empirical evidence of therelationship between demographics and interest rates over a wide sample of advanced andemerging market economies. It also finds that capital account openness limits the directsensitivity of a country's interest rates to its own demographics. The results suggest thatfuture demographic developments will continue to apply downward pressure on theinterest rates in Asia which foresees a rapid aging.

Keywords: demographics, interest rates, capital account openness

JEL Classification: E20, F30, J10

Suggested Citation

Arslanalp, Serkan and Lee, Jaewoo and Rawat, Umang, Demographics and Interest Rates in Asia (July 2018). IMF Working Paper No. 18/172. Available at SSRN: https://ssrn.com/abstract=3236787

Serkan Arslanalp (Contact Author)

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

Jaewoo Lee

International Monetary Fund (IMF) - Research Department ( email )

700 19th Street NW
Washington, DC 20431
United States
202-623-7331 (Phone)
202-623-6334 (Fax)

Umang Rawat

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

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