Research - Refuting the dependency claim

The Emerging Myth of "Age Dependency"

Growing concern is being expressed in some quarters about supposedly rising levels of “age dependency” in several developed countries in Europe and other advanced economies, where populations are stagnating.

This concern predicates a growing proportion of “dependents”, mainly those past retirement age, relative to the active section of the population capable of supporting them. The position appears exacerbated by under-provision of retirement funds in a number of countries.

Such a viewpoint argues in favour of policies that encourage a higher birth rate and higher levels of net immigration to realign such dependency ratios.

Refuting this Argument

For the majority of developed countries this position is untenable, unrealistic and outdated. There is no justification for either set of measures:

Firstly, a scenario which requires ever rising levels of population in order to maintain living standards. The spiral has to be halted at some point – not least because the young “productive” elements added to the population will in themselves require support once they reach retirement age. Furthermore any policy to raise birth rates will actually increase dependency ratios for the initial couple of decades.

Secondly, technical advances in virtually all fields have greatly increased per capita productivity since concerns of growing “ age dependency” were first formulated – enabling progressively higher levels of dependency to occur without compromise to living standards.

This aspect is simply ignored by those concerned about the so-called growth of “Age Dependency”

Thirdly, people are living much longer and in better health. In many cases they are already working later into life, and there is a growing current of opinion in favour of more flexible retirement norms.

A fixed retirement age of 60 or 65 curbs productive capacity, wastes accumulated skills and experience, and can blight the livelihoods of active individuals.

This has recently been implicitly recognized in the UK government’s recent proposal to raise the retirement age to 68 following the recommendations of the Turner Report.

Such progressive raising of the retirement age over a 30-40 year period would still allow scope for a longer post-work period than has ever historically applied – being almost directly matched by annual increments in longevity. This should be accompanied by more farsighted provision of retirement support through state and private sector schemes.

Any review of demographic changes and their impact on future provision for dependent sections of society must be based on sound science.

Profoundly Confusing Signals

Too often population growth is equated by politicians with the growing power and status of a nation. Too often calls to boost national population levels rest on vague assumptions that rising populations are somehow “good for growth”.

Quite apart from issues of sustainability in the developed world, such calls send profoundly confusing signals to developing countries, where high levels of population increase in many areas are hindering economic growth and poverty alleviation, as well as contributing towards environmental degradation, climate change and conflict.

Please contact us if you would like to contribute to this initiative
ta@populationandsustainability.org

December 2005

Research: Working Group on the Impact of Population Growth

A central activity of the Network is the promotion of a research programme to identify and assess all aspects of the economic, social and environmental costs of population increase - particularly when these aspects may hinder poverty alleviation.

There are three parts to this programme:

1. A Review of existing information and organisations

• Map all key organisations involved in population studies with special reference to economic, social and environmental impacts.
• Map in outline the extent of population planning in each country, where this can be readily identified - including size of budgets and main organisations involved.
• Undertake a review of existing literature to inform the Working Group's objectives. Identify gaps and draft specifications of research required to address these.

• Complete research on full economic, social and environmental costs of population increase to inform the Working Group's objectives. Develop case studies. Develop key measures of impact. Identify budgets required to implement these.

3. Promotion of Findings

• Feed the resulting information into appropriate organisations and processes to influence national and international policy (at government and NGO level, nationally and internationally).

Click here to see the summary specification for the project.

Please contact us if you would like to contribute to this initiative.