Demographic Change, Technological Advances, and Growth: A Cross-Country Analysis

Cyn-Young Park (), Kwanho Shin () and Aiko Kikkawa ()
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Kwanho Shin: Korea University
Aiko Kikkawa: Asian Development Bank

No 617, ADB Economics Working Paper Series from Asian Development Bank

Abstract: This paper revisits the impact of population aging on economic growth. In order to understand the impact of population aging on economic growth, it is important to consider the changes in the entire age distribution of demography. Our empirical analysis indicates that a change in age distribution that increases the proportion of older people while reducing the working-age population lowers economic growth. We also investigate the effect of technological advances on the relation between population aging and economic growth, using four plausible proxies of technological advancement: life expectancy, labor productivity, automation, and total factor productivity. We find that increasing life expectancy and labor productivity benefit old age groups as they likely help older age groups contribute more positively to future growth. More automation also helps improve productivity of old age groups but in a different way. When robot density increases, old age groups become less disadvantaged compared to the young. Lastly, technological adoption enhances the growth contribution of productive age groups from the 30s to 60s when one compares low with high total factor productivity scenarios.

Keywords: demographic change; growth; labor productivity; life expectancy; robotics (search for similar items in EconPapers)
JEL-codes: J11 J24 O33 O47 O57 (search for similar items in EconPapers)
Pages: 36 pages
Date: 2020-07-10
New Economics Papers: this item is included in nep-age, nep-eff and nep-gro
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Journal Article: Demographic change, technological advance, and growth: A cross-country analysis (2022)
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