The Impact of Population Ageing on the Czech Economy

Jan Babecký and Kamil Dybczak

Working Papers from Czech National Bank, Research and Statistics Department

Abstract: The Czech Republic is facing a population ageing phenomenon. In addition, its demographic structure is expected to change dramatically over the next 50 years. We apply a stylised overlapping generation model in order to analyse the potential effects of the expected demographic changes on aggregate economic performance taking into account alternative fiscal policy set-ups. We provide a rough estimate of the amendments necessary on the revenue and expenditure sides in order to keep the current system financially balanced. We also discuss the implications for the development of other economic variables. In particular, we separately simulate future developments in the cases of adjustment in either the contribution rate or the value of public benefit. In addition, we demonstrate that parametric changes, such as an increase in the statutory retirement age, cannot eliminate the impact of the deterioration in the demographic structure on the course of the economy.

Keywords: Population ageing; public pension systems; social security. (search for similar items in EconPapers)
JEL-codes: E27 H55 J11 (search for similar items in EconPapers)
Date: 2009-09
New Economics Papers: this item is included in nep-age, nep-dge, nep-mac and nep-tra
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:cnb:wpaper:2009/1

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