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Title:Introducing demographic changes in a model of economic growth and income distribution PDF Logo
Authors:Rada, Codrina
Issue Date:2009
Series/Report no.:Working Paper, University of Utah, Department of Economics 2009-01
Abstract:Unprecedented demographic changes are set to unfold in most of the industrialized world. They are relevant not only because of the diminishing pool of workers, but also because of the increasing importance of retirees as an economic class. Retirees' consumption and saving patterns can differ considerably from those of wage earners and capitalists, as retirees tend to consume more services and save less or in fact dissave. From this perspective of changing aggregate consumption and saving patterns I argue that population aging together with existing constraints to growth and the institutional framework in place leads to a reconfiguration of income distribution and therefore to possible changes in the growth rate of the economy. Understanding how future income distribution may look like and the behavior of different economic classes, helps in designing the right policies to accommodate the demographic transition.
Subjects:population aging
income distribution and growth
Keynesian macroeconomics
JEL:E12
E24
E60
Document Type:Working Paper
Appears in Collections:Department of Economics Working Paper Series, University of Utah

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