The Aging Population and the Competitiveness of Cities

The Aging Population and the Competitiveness of Cities

Benefits to the Urban Economy

Peter Karl Kresl and Daniele Ietri

While much of the current literature on the economic consequences of an aging population focuses on the negative aspects, this enlightening book argues that seniors can bring significant benefits – such as vitality and competitiveness – to an urban economy.

Chapter 2: The Demographic Situation in the US and in the EU

Peter Karl Kresl and Daniele Ietri

Subjects: economics and finance, political economy, regional economics, geography, cities, politics and public policy, political economy, public policy, social policy and sociology, ageing, economics of social policy, urban and regional studies, cities, urban economics


During the coming decades the age distribution of the industrialized economies will become one in which the ratio of seniors to working people will become higher to the point that the ability of the current economic system to remain fiscally viable will be put seriously in jeopardy. The aging of the population is, in fact, one of the most important issues of public policy that confront the industrialized economies for the foreseeable future. The aging of the population is a phenomenon that is found throughout the OECD-industrialized world, while among the developing world, due to higher birth rates and shorter life expectancy, this is a problem that will not be seen for decades. In this chapter we will examine: some of the aspects of aging; the aging that is foreseen for the US and the EU; the consequences of that aging; and, finally, some characteristics of the seniors who make up this cohort of the population. THE STRUCTURE OF AGING We are not demographers, but from the perspective of the economy we believe that an optimally age-distributed population would have a structure similar to that depicted in Figure 2.1. This distribution has the shape of a “flared bell,” with death occurring primarily in the first year of life and, of course, in advanced ages; clearly, we are not artists either. The middle ages should be rather stable. This structure can be continued ad infinitum, disturbed only by events such as war, epidemic, policies designed to reduce population growth, and natural...

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