Macroeconomic Consequences of Demographic Ageing: Simulations Until 2050

The change in the age structure of a society has far­reaching consequences for the macroeconomic development of an economy. One of the expected consequences of an ageing population is that labour productivity and real GDP per capita will decline. This article presents results from combining the European Commission's approach to long­term forecasting with regression analyses covering the relation between macroeconomic key variables and indicators of demographic change. The simulation results for Germany, Japan and the USA through 2050 show how key macroeconomic indicators (labour productivity, GDP per capita, savings rate, investment rate, inflation rate and current account balance) change due to ageing. Countries with rapidly aging populations such as Japan and Germany in particular should expect a noticeable slowdown in the growth of real GDP per capita.