Working Paper: CEPR ID: DP179
Authors: John Ermisch; Heather Joshi
Abstract: This paper examines the economic rationale for concern about the falling rate of growth of Europe's population. It also assembles demographic and economic time-series data for the countries of Eastern and Western Europe during the postwar period. The consequences of demographic developments for social welfare, broadly defined, are felt over a very long term. Issues discussed include the contribution of increases in life expectancy to social welfare; the potential effects of population growth on technical progress; and the impacts of changing age structure on intergenerational transfers and the financing of state pensions. The analysis suggests that, while the slowdown in European population growth raises some potential problems, there is no compelling case for pro-natalist policies.
Keywords: demographic change; economic growth; welfare; pensions; labour force; fertility; europe
JEL Codes: 123; 820; 840; 910
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| demographic changes (J11) | social welfare (I38) |
| population growth (J11) | economic growth (O49) |
| economic growth (O49) | social welfare (I38) |
| increases in life expectancy (I14) | social welfare (I38) |
| low fertility rates (J13) | decline in labor force growth (J21) |
| stagnant population (J11) | slower technological development (O39) |
| declining population (J11) | adverse effects on intergenerational transfers (D15) |
| declining population (J11) | sustainability of pension systems (H55) |