Abstract
We assess the impact of an aging rural population using the Wisconsin Economic Impact Modeling System, a county-level conjoined input-output/ econometrics simulation model. Using data from the U.S. Bureau of Labor Statistics Consumer Expenditure Survey, we construct profiles of two household types to simulate the economic and fiscal impacts of 500 additional elderly households in a small rural economy. Household types vary by income levels and expenditure patterns. The results suggest that, from the perspective of local government officials, high-income elderly households will increase local expenditures more than a similar number of low-income retiree households, but the resulting increase in revenues will more than offset the increased expenditures.
Highlights
In 1920 less than one American in 20 was over the age of 65
The early literature, which focused on the migration of younger and wealthier retirees, has pointed to the positive impacts that retirees can bring to a community
What are the economic and fiscal impacts of the aging-in-place? Or, what will happen if in-migrants are older? Or poorer? Preliminary attempts to answer these questions have led to inconsistencies in research findings and policy recommendations, muddying the waters
Summary
In 1920 less than one American in 20 was over the age of 65. By 1995, the proportion of Americans over 65 had risen to one in eight. As the baby boomers have grown older, they have changed their consumption bundles ·according to their changing tastes and preferences This has resulted in a fundamental shift in purchasing patterns that has dramatically altered the level and type of the goods and services demanded in the economy. While a large body of research recognizes the impacts of an aging population on local economies, it is unfortunate that this literature is scattered over several disciplines, including economics, sociology, and gerontology. One result of this dispersion is that the literature has numerous strands that are not well integrated. The paper closes with an overview of findings and a discussion of implications for local community development decision makers
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