Is There an Aging Population Kuznets Curve?

Abstract

Based on a sample of 126 countries over the period of 1970 to 2019 and 5-year nonoverlapping growth regressions, this study has revealed the existence of an inverted U-shaped aging population Kuznets curve. The threshold levels below (above) which aging population potentially promotes (hampers) economic and productivity growth are estimated. While the results signal the growing pressure of aging population on economic/productivity growth, the impact is more pronounced on labor productivity growth and only for advanced economies. Our findings remain robust to alternative proxies of aging population and longer period (10- and 15-year) non-overlapping growth regressions.

Keywords: Aging population, Economic growth, Productivity, non-linear effects, threshold