Population Aging Capital Formation and Economic Growth

  • 羅 慧君

Student thesis: Doctoral Thesis

Abstract

This dissertation aims to explore the impacts of population aging on Japan’s economic performance A demographic–economic growth model is applied to study the relationship among labor force age structure human capital saving and physical capital formation and economic growth The impacts of population aging on economic growth are decomposed into two separate effects: The effects on labor productivity and human capital formation and the effects on saving and physical capital accumulation A new dimension of human capital accumulation to GDP growth is introduced by including the demographic factor in the context of human capital estimation and a significant role of prime labor cohort those aged 25 to 49 in the accumulation of human capital is found Based on life-cycle hypothesis (LCH) saving rate varies with age and the profile of age structure as population aging evolves Japanese empirical data indicates that Japanese saving rate declines with its aged population and the declining saving resulting from population aging leads to slow economic growth in Japan The empirical results in this study show the population aging would lead to decline in Japanese GDP growth for the next half century to come Population aging also causes a decline in the rate of change in aggregate saving in Japan Policy measures that prompt continuous increase in total factor productivity encourage saving to increase capital formation should be considered to mitigate the declining growth rate trend
Date of Award2014 Sep 12
Original languageEnglish
SupervisorYuan-Ho Hsu (Supervisor)

Cite this

Population Aging Capital Formation and Economic Growth
慧君, 羅. (Author). 2014 Sep 12

Student thesis: Doctoral Thesis