Hello everyone, while studying for Economics Chapter 2 that is Economic Growth and Investment Decision, I encountered a particular doubt regarding a concept, that is in demographics if Population of above the age of 64 is rising, it impacts will be negative on Long Term Economic Growth. If Population is rising between age 16 to 64, its impacts will be positive on LTEG. My question is how will Population growth below 16 years of age affect the Long Term Economic Growth?
I should imagine that its effect would be positive on long-term economic growth.
A source of economic growth is labor growth. If population below 16 year-old is growing, we have labor input for future economic growth. A real case scenario are old societies like many countries in Europe or Japan where population ages and it is even expected a population growth of almost 0%. As people ages, they stop working and producing, so economic growth decreases. If there is no more population to replace retirees, economic growth is expected to decrease even more.
aging population over 64 is negative for LTEG as how much more do you think they can work.
under 16, is positive as over time they would joing the workforce and contribute to LTEG