Abstract
The age of Southeast Asian developing countries’ populations is still younger than that of other regions around the world. However, recent statistics show that the tide is now turning in this regard, with many of these populations beginning to age at rates much faster than many other countries. Such developments require immediate policy action in order to create a sustainable path towards economic growth before demographic changes become less benign in the medium term. In this study, we discuss the economic consequences of population aging, increases in the economic support ratio, and a declining potential growth rate. We argue that it is essential for Southeast Asian developing countries to raise total factor productivity (TFP) growth rates so as to achieve more sustainable economic outcomes. By conducting panel regressions using data from 82 countries across the 1996–2019 study period, our study shows that increasing research and development (R&D) spending and the facilitation of structural changes that transform the digital economy landscape are key policy options that promote TFP growth.
Highlights
Most Southeast Asian developing countries have aging populations
In terms of our first research question (R1), as to whether Southeast Asian developing countries are encountering a demographic transition toward population aging, we find most developing Southeast Asian countries have increasingly aged populations they are still regarded as being relatively youthful when compared to other countries in
Recent statistics reveal that the demographic transition toward population aging, i.e., a growing share of the elderly in the total population, began around 2020, with the speed of this growth being much faster than in other developing regions, such as African countries in the Tropics
Summary
Most Southeast Asian developing countries have aging populations. It assesses the ways in which developing Southeast Asian countries are managing their demographic transitions toward population aging. With an accelerating transition towards a fully integrated digital economy, which has, in no small part, been facilitated through a series of global lockdowns and work-from-home notices brought about by the current COVID-19 pandemic, the time has never been better to implement new policy tools and measures in the ICT space Despite these important contributions, a lack of developing country data, R&D data, meant we were not able to run the separate TFP empirical analyses for each of the Southeast Asian developing countries.
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