International Diversification of Pension Assets Is No Panacea for Population Aging

F.L. MacKellar and Helmut Reisen

Working Papers from International Institute for Applied Systems Analysis

Abstract: Six years ago,\f2The Economist\f1 wrote that investing retirement savings in developed countries in the emerging markets of still-youthful developing countries promised to "beat demography." As labor force growth slows in the North, runs this argument, capital becomes abundant relative to labor and the rate of return to this capital declines. By investing in the South, not only do OECD investors earn a higher rate of return on their savings, but the rate of return to that capital which remains in the North is boosted as well, because there is less of it. Working with a two-region neoclassical economic-demographic model, the authors show that reallocating capital from North to South can, at most, only slightly attenuate the negative macroeconomic impacts of population aging. Moreover, the reallocaion gives rise to significant, and thus politically challenging, shifts in the distribution of income between working- and retirement-age populations in both regions.

Date: 1998-06
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

Downloads: (external link)
http://www.iiasa.ac.at/Publications/Documents/IR-98-034.pdf (application/pdf)
Our link check indicates that this URL is bad, the error code is: 404 Not Found (http://www.iiasa.ac.at/Publications/Documents/IR-98-034.pdf [301 Moved Permanently]--> https://www.iiasa.ac.at/Publications/Documents/IR-98-034.pdf [301 Moved Permanently]--> https://iiasa.ac.at//Publications/Documents/IR-98-034.pdf [302 Found]--> https://iiasa.ac.at/Publications/Documents/IR-98-034.pdf)
http://www.iiasa.ac.at/Publications/Documents/IR-98-034.ps (application/postscript)
Our link check indicates that this URL is bad, the error code is: 404 Not Found (http://www.iiasa.ac.at/Publications/Documents/IR-98-034.ps [301 Moved Permanently]--> https://www.iiasa.ac.at/Publications/Documents/IR-98-034.ps [301 Moved Permanently]--> https://iiasa.ac.at//Publications/Documents/IR-98-034.ps [302 Found]--> https://iiasa.ac.at/Publications/Documents/IR-98-034.ps)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:wop:iasawp:ir98034

Access Statistics for this paper

More papers in Working Papers from International Institute for Applied Systems Analysis Contact information at EDIRC.
Bibliographic data for series maintained by Thomas Krichel ().