Mason, Andrew
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ItemEast Asian economic development : two demographic dividends(Honolulu: East-West Center, 2005)The importance of the demographic dividend to East Asian economic growth is now widely recognized. During the last four decades of the 20th Century the working age populations grew much more rapidly than the dependent populations fueling growth in per capita income. Over the coming decades, however, demographic change is seemingly unfavorable. In the coming decades the working-age populations of many countries will grow more slowly than dependent populations because of rapid growth of the elderly. Thus, the demographic dividend will be undone. The thesis advanced in this presentation, however, is that appropriate economic policy could produce a second demographic dividend one that is as great or greater than the first dividend and one that may last indefinitely. Contrary to popular wisdom, population aging may prove to be the source of stronger economic growth and greater prosperity in East Asia.
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ItemSaving, wealth, and the demographic transition in East Asia(Honolulu: East-West Center, 1997)This paper assesses the extent to which demographic forces can explain the substantial increases in national saving rates in East Asia over the last few decades, under the strong assumption that saving is motivated by a desire to provide for consumption in retirement. Comparative, steady-state analysis shows that relatively low rates of saving should characterize either pre- or post-transition societies, but that post-transition societies have a much higher demand for wealth than do societies yet to have begun their demographic transition. A dynamic simulation model is used to analyze saving rates during the transition. Using detailed demographic and economic data based on the experience of Taiwan, we show that demographic factors may underlie a substantial portion of the rise in net national saving experienced in the region. Further, our model anticipates a rapid decline in saving as countries approach the end of their demographic transitions and achieve high levels of wealth.
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ItemJapan's unprecedented aging and changing intergenerational transfers( 2008-08-15)This paper analyzes some of the important aspects of Japan's unprecedented population aging on its postwar economy, by drawing heavily upon the computed results of the NTA-Japan project, ranging from the first and second demographic dividends to the lifestyle reallocations. We also shed light on the rapidly changing roles of public and familial support systems for the elderly in Japan, that have evolved together with the family organizational transformation and the rapid development of the social security system over the past several decades.One of the principal findings of this paper is that an effective use of the demographic dividends, particularly the accumulated second demographic dividend which is likely to remain substantial for the next few decades, appears to be an attractive policy option for Japan to place its future economic growth on a steady path. Another important finding derived from this study is that, since the bursting of the bubble economy in the early 1990s, Japanese elderly persons have been informally playing the role of the society's safety net in providing financial assistance to their adult children and/or grandchildren through the traditional familial transfer mechanism.
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ItemFertility, human capital, and economic growth over the demographic transition( 2008-06-16)Over the demographic transition, declining fertility leads to rising support ratios and consumption during the first divided phase, followed by falling support ratios as population ages. Might human capital investments rise sufficiently as fertility falls to preserve the initial gains? Using a new cross-national data set, we estimate that a constant share of life time labor income is invested in human capital, so that the proportion invested per child is inversely proportional to the number of children. We draw from the literature an estimated elasticity of labor productivity with respect to human capital. Combining these, we simulate the effect of fertility variations over an exogenous demographic transition, including varying child and old age dependency, on consumption. In the baseline simulation, the increased human capital investments due to lower fertility initially reduce consumption as fertility falls but subsequently raise consumption despite population aging and increased transfers to the elderly.
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ItemSustainable economic policies in an aging world( 2008-02-21)This paper examines the economic implications of population aging in light of new estimates and analysis of the inter-relationships between age and the economy based on the National Transfer Account (NTA) project. The NTA project is an international effort involving research teams from 25 countries coordinated by Ronald Lee, Director of the Center for the Economics and Demography of Aging and myself. An important goal is to develop and apply a system for measuring economic flows across age groups - primarily from the working ages to the dependent ages, childhood and old age. These flows are a natural consequence of the economic lifestyle that characterizes all contemporary societies studied to this point. In all countries the flows are very large, but the systems of reallocating resources across age groups vary considerably from one country to the next. Some countries depend heavily on public transfers; other rely more on familial transfers; and still others place greater emphasis on lifecycle saving. A central thesis of this work is that economic effects of changes in population age structure depend in a critical way on the systems responding to the resource deficits that exist at younger and older ages. Effective policy responses are essential to sustaining standards of living in an aging world.