1 Introduction
Throughout the world industrialised economies are experiencing a shift in the age structure of their populations. The advent of ageing populations will impact considerably upon the way in which these economies function. It is difficult, however to be sure what the economic implications of ageing populations will be given that it is a globally unprecedented phenomenon.
This paper provides a synoptic view of the economic issues that surround the phenomenon of ageing populations. Its goal is to provoke debate and to provide a catalyst for discussion on the economic “problem” of population ageing. Particular emphasis has been placed on raising issues that require further investigation and on developing a framework that will prove useful for further research.
The paper is structured as follows. In the next section we consider demographic changes, summarising projections for the New Zealand population and examining the key demographic issues that arise out of expected structural changes in the age distribution.
In the third section of the paper we discuss of the impacts of demographic change upon the labour force. In this section, while we consider aggregate participation rates, the emphasis is on the interrelationship between individuals’ labour force participation decisions and population ageing.
Section 4 discusses the implications of ageing populations upon the demand for public resources and their financing. The section is concluded with brief reference to the role that the political process may have upon future demands on public resources. Section 5 discusses the effect of population ageing upon capital markets, while Section 6 introduces some of the salient issues regarding ageing populations and long-run economic growth. The final section consists of concluding remarks and suggestions for further research.
