The Impact of Population Ageing on the Labour Market: Evidence from an OLG-CGE Model

Katerina Lisenkova, Marcel Merette, Robert Wright

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Abstract

This paper presents a dynamic Overlapping Generations Computable General Equilibrium (OLG-CGE) model of Scotland. The model is used to examine the impact of population ageing on the labour market. More specifically, it is used to evaluate the effects of labour force decline and labour force ageing on key macro-economic variables. The second effect is assumed to operate through age-specific productivity and labour force participation. In the analysis, particular attention is paid to how population ageing impinges on the government expenditure constraint. The basic structure of the model follows in the Auerbach and Kotlikoff tradition. However, the model takes into consideration directly age-specific mortality. This is analogous to “building in” a cohort-component population projection structure to the model, which allows more complex and more realistic demographic scenarios to be considered.
Original languageEnglish
Title of host publicationProceedings of the 2012 Ecomod Conference
EditorsAli Bayar, A Cardenete
Place of PublicationWashington
Number of pages22
Publication statusPublished - Jul 2012
EventEcoMod2012 - Seville, Spain
Duration: 1 Jan 19706 Jul 2012

Conference

ConferenceEcoMod2012
CountrySpain
CitySeville
Period1/01/706/07/12

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Keywords

  • population ageing
  • Scotland
  • CGE modelling
  • labour market
  • impact

Cite this

Lisenkova, K., Merette, M., & Wright, R. (2012). The Impact of Population Ageing on the Labour Market: Evidence from an OLG-CGE Model. In A. Bayar, & A. Cardenete (Eds.), Proceedings of the 2012 Ecomod Conference Washington.