Abstract
This chapter presents a three-region, three-good, fifteen overlapping generation's model to analyze the inter-regional consequences of population aging in Canada. Each region of the model produces one imperfectly substitutable good. Households work the first 12 periods of their life and retire in the last three. The household's behavior is characterized by the life-cycle theory and the financial market is perfectly integrated. Regions differ from each other by the size of their economy, their specific local taxation, and especially their demographic projections. The inter-regional implications arising from the asymmetric portion of the population aging pressures are investigated. When health care is added to the base case scenario, the asymmetry of the aging shock is strengthened. Health care expenditures financed by provincial governments may lead toward more economic inequality across regions. Regional governments more afflicted by aging populations are not able to transmit the fiscal pressure over the shoulders of individuals other than their own citizens.
Sign-in/Register to access full text options 
Free) 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
