Population Aging and Global Capital Flows in a Parallel Universe

Robin Brooks

No 2000/151, IMF Working Papers from International Monetary Fund

Abstract: This paper explores the global impact of population aging, using a calibrated overlapping generations model of eight world regions to simulate the effects of historical and projected demographic trends on international capital flows. The simulations show that there will be a turning point in regional savings – investment balances between 2010 and 2030 when the European Union and North America will experience a substantial decline in savings relative to investment as their populations age rapidly. This shift will be financed by capital flows from less developed regions which are projected to become capital exporters.

Keywords: WP; interest rate; capital deepening; real GDP; population aging; international capital flows; EU current account; JAP relative; EU experience; age distribution; productivity parameter; balance in the EU; current account switch; Current account; Current account balance; Aging; Current account deficits; Demographic change; North America; Global; Africa (search for similar items in EconPapers)
Pages: 31
Date: 2000-08-01
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Citations: View citations in EconPapers (9)

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Journal Article: Population Aging and Global Capital Flows in a Parallel Universe (2003)
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