Effect of World Fertility Scenarios on International Living Standards
This paper applies a two good, multi-region Ramsey-Solow model of the world economy to determine the impact that alternative world fertility rates would have on international capital markets and living standards. Notable features of the model include: relative consumption demands and relative employment efficiencies that vary by age, traded and non-traded goods, vintage technology, outward-looking reference consumption, a proportion of non-optimising rule-of-thumb consumers and imperfect capital mobility due to asymmetric information. The model suggests that projected demographic change will imply a flow of international capital from the ageing regions to the younger regions; and that the world interest rate will fall. The lower world interest rate will cause a loss in living standards for ageing regions, the lenders, and a gain for the younger regions, who are borrowers. Copyright © 2004 Economic Society of Australia..
Year of publication: |
2004
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Authors: | GUEST, ROSS S. ; MCDONALD, IAN M. |
Published in: |
The Economic Record. - Economic Society of Australia - ESA, ISSN 1475-4932. - Vol. 80.2004, s1, p. 1-1
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Publisher: |
Economic Society of Australia - ESA |
Saved in:
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