Incorporating demographic change in multi-country macroeconomic models: some preliminary results*

The Economics of an Ageing Population studies the effects of demographic transition on the economies of industrialised countries. The authors demonstrate that an ageing population does not necessarily lead to a reduction in growth, providing that the working population are more productive and save a greater percentage of their income. They look in detail at the examples of Italy and Japan, two countries which have the fastest ageing populations in Europe and the world respectively.