Europes Demographic Opportunity: Unlocking The Value Of Health

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Europes Demographic OpportunityUnlocking The
Value Of Health

• Nicholas Eberstadt
• Henry Wendt Chair in Political Economy
• American Enterprise Institute
• eberstadt_at_aei.org
• Bruno Leoni Institute
• Milano, 8 June 2007

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Figure 1Western Europe v. U.S. Population
Structure, 2005

• Source U.S. Census Bureau, International Data
  Base, available at http//www.census.gov/cgi-bin/i
  pc/idbagg accessed August 3, 2006.

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Figure 2Western Europe vs. U.S. Population
Structure, 2030

• Source U.S. Census Bureau, International Data
  Base, available at http//www.census.gov/cgi-bin/i
  pc/idbagg accessed August 3, 2006.

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Figure 3The Age Distribution of Great Innovation
Source Benjamin Jones. 2005. Age and Great
Innovation (Working Paper 11359). Cambridge MA
National Bureau of Economic Research.
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Figure 4 Health Equals Wealth LE vs PPP Per
Capita GDP
US
years
Source World Development Indicators, 2003
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Healthy Life Expectancy
Figure 5Healthy Life Expectancy Western Europe
vs US
Source Organisation for Economic Co-operation
and Development, Society at a Glance OECD
Social Indicators, 2005 Edition (Paris OECD,
2005).
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Figure 6Odds of Not Surviving from Age 20 to Age
65 Western Europe vs US
Proportion of population that does not survive
Note Based on age-specific mortality schedules
for the year 2002 Source Human Mortality
Database. University of California, Berkeley
(USA), and Max Planck Institute for Demographic
Research (Germany). Available at
www.mortality.org or www.humanmortality.de (data
downloaded on 12/21/06).
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Figure 7US Consumption and Labor Earnings by
Age, Distinguishing private and public
components (in kind transfers and prorated items
like defense cash benefits excluded)
Total Consumption
Labor earnings
public
private
2000 calculationsSource Ronald Lee, Global
Population Ageing and its Economic Consequences
(AEI Press, forthcoming)
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Figure 8Male Retirement Age v. Life
ExpectancyFrance, 1962-1999
Age
(LE)
Source Human Mortality Database. University of
California, Berkeley (USA), and Max Planck
Institute for Demographic Research (Germany).
Available at www.mortality.org or
www.humanmortality.de (data downloaded on August
3, 2006) and Age of Withdrawal from the Labour
Force in OECD Countries, Labor Market and Social
Policy Occasional Papers No. 49, by Peter
Scherer. January 11, 2002
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Figure 9Labor Force Participation RatesEurope
vs. Non-Europe OECD, c.2004
Participation Rates
Source International Labor Organization,
LABORSTA, available at http//laborsta.ilo.org/.
Note Data are for 2004, except for Italy (2005)
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Figure 10Population Change in W. Europe vs US
2005-2030
Population Change
Source U.S. Census Bureau, International Data
Base, available at http//www.census.gov/cgi-bin/i
pc/idbagg accessed August 3, 2006.
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Figure 11Incentives to Retire and Retirement
Behavior
Fall in male labour fonce participation between
ages 50-54 and 55-59
Implicit tax on continued work at ages 55-59,
per cent
1. Difference in participation rates between the
age groups 55-59 and 50-54 as a percentage of the
participation rate of those aged 50-54 years. 2.
The implicit tax on working an additional year is
the foregone transfer/pension income plus the
additional pension contributions paid minus any
increase in future pensions as a result of
delayed retirement, all expressed as a share of
income from work. The calculations in all cases
take account of the "regular" old-age pension
scheme but consider somewhat different early
retirement pathways depending on the country in
question or, where such schemes do not apply
widely, no such pathways. Source Strengthening
Growth and Public Finances in an Era of
Demographic Change, OECD May 13-14, 2004