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Aging populations and plunging birthrates threaten the world’s economies. So what’s the solution?

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8

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  • Innovative

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As more people live longer and fewer people have babies, the world’s population will shrink and become older. International Monetary Fund economists Benedict Clements, Kamil Dybczak and Mauricio Soto examine the disturbing implications of this trend. While several previous studies have explored the financial consequences of aging populations on various countries by 2050, this article provides a valuable look at the problem across 100 nations by 2100, when the world will face the “full effects of the demographic transitions.” getAbstract recommends this eye-opening report to economists, government officials and business executives.

Summary

Aging populations present an urgent challenge to the fiscal health of both emerging and developed economies. With fertility and mortality rates dropping around the world, the problem is likely to worsen over the next several decades. The United Nations forecasts that the global population will stop growing around the year 2100 and start to decrease. The ratio of people aged 65 and older to those aged 15 to 64 will triple by then. This “old-age dependency ratio” could increase five-fold in China and other emerging markets, while it could...

About the Authors

Benedict Clements is a division chief at the International Monetary Fund’s Fiscal Affairs Department, where Kamil Dybczak and Mauricio Soto are economists.

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