Francesca Carta, Francesco D'Amuri, Till von Wachter, 16 March 2021

Population ageing reduces labour supply and burdens pension systems. At the same time, delaying the statutory retirement age may have an impact on firms’ productivity and risks crowding out younger workers. This column exploits an unexpected pension reform in Italy in 2012 which sharply increased the full retirement age for workers aged 55 or above to show that such concerns may not be warranted. A rise in employment of older workers led to an increase in value added while holding labour costs constant. Employment in other age classes also increased. This suggests older workers are valuable to employers and that pension reforms postponing retirement can remove a constraint rather than placing a burden on firms.

Hendrik van Dalen, Kène Henkens, 30 October 2011

This week the world population is projected to reach seven billion. Yet in some countries the prospect of a decline in population is worrying policymakers far more. This columns asks what the people think, focusing on a survey from the Netherlands. It turns out that most people are in favour of global population decline, but “not in my backyard”.


CEPR Policy Research