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Ageing Society & life cycle Hypothesis
Question: effects of an ageing society on the economy
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It affects both developed and developing countries
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The population of
developed countries is ageing fast, and the developing world is only a few
decades behind
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This pattern is expected to continue
over the next few decades and eventually take over the entire world
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An ageing society means that countries dependency ratios will rise
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With people living longer, from an individual point of view is a good thing as it
shows we will be healthier and childbearing wont be a lottery anymore
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The pressure created on the healthcare system will increase due to the
diseases and illnesses we’ll accumulate over a long period of time
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Time has meant we are
now able to survive the acute diseases and we have a better chance of
surviving the chronic diseases
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An ageing society creates a massive impact for the pension scheme too
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This means for every one person who is retired there will be
four people working to support their pension
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Either
pensions will fall which means that salary schemes within the workplace are
dying out or longer life expectancy will mean that social contributions will rise
and thus either we will be paying more for state pensions or private schemes
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We might be able to boost our pensions by using some of our income that we
earn from the age of 15 to 65 to put into our pension pot
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Thus bearing
less of a burden of society as we can pay our way a bit more
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to help fund our societies
needs for advanced healthcare and with people living longer we are going to
have to fund their pensions for longer too
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