Old People Are About To Change The Global Economy

from Business Insider

In the 20th century the planet’s population doubled twice. It will not double even once in the current century, because birth rates in much of the world have declined steeply. But the number of people over 65 is set to double within just 25 years.

Business Insider suggests 3 ways of how it can affect global economy

1. Larger number of older people will slow the growth and less savings. That will increase interest rates and the asset prices will fall. Some other specialists say that older people will work longer in future, which will change the demography of workforce.

2. But an even more important factor is education. Better-educated older people are far more likely to work for longer. Gary Burtless of the Brookings Institution has calculated that, in America, only 32% of male high-school graduates with no further formal education are in the workforce between the ages of 62 and 74.

3. A smaller workforce need not dampen growth, though, if productivity surges. This is not something most would expect to come about as a result of an ageing population. Plenty of studies and bitter experience show that most physical and many cognitive capacities decline with age.

Read more: http://www.businessinsider.com/old-people-to-change-the-global-economy-2014-4#ixzz309h6gocn

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