Age structure effects on economic growth — Swedish evidence

Abstract

Abstract This paper argues that age structure is an important factor behind variations in the rate of economic growth. Theoretically, the argument is based on Romer's model of endogenous technical change, human capital theory and the life-cycle theory of savings. Taken together, these theories imply that growth rates are dependent on age structure. Empirically, the existence of age structure effects is demonstrated through an analysis of Swedish growth data for the 1950 to 1989 period. The age pattern of these effects is consistent with an explanation based on differences in savings behaviour and human capital accumulation over the life cycle.