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Global Economy Bursting?

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How many on this forum alone are over 64 and still working?

At the very least the graph supposes that all stop working at age 64 ... which can often be shown to be false just by shopping at Walmart.

In other words, it is a doom and gloom propaganda piece to get people all worked up and push certain agendas (such as raising retirement ages or such).

The fact that some people over 60 are working is not a testament to a lack of a problem. It points to a problem that they have to work. And these aged people do not have the stamina and endurance that younger people have. Therefore they are not as productive as they once were.

Also, there is a statistic that you may not agree with, but, 1 out 3 individuals in the U.S. (over 100 million) receive either food stamps or Medicaid, not Social Security and not Medicare.

-9.img_assist_custom-640x465.png


The working age population definition says nothing about labor participation rate. It means the burden of supporting all those not working or receiving benefits from government programs falls mainly on that group of people.

The other facts you may disagree with is that food prices are going to rise because cheap labor is no longer available in the form of legal and illegal immigrants. That will also accelerate the aging of the population as these were working age people who also had higher fertility rates are not coming into the U.S. but a significant number are leaving, voluntarily and involuntarily.

Bottom line, there is a big problem aging that affects economic growth. It is being reported by researchers.
 
Introduction

The world is entering largely unfamiliar territory with respect to population aging. Combined with the dynamic evolution of past variations in birth and death rates, recent declines in fertility rates and increases in life expectancy are causing a significant shift in the global age structure. The number of people over the age of 60 is projected to reach 1 billion by 2020 and almost 2 billion by 2050, representing 22 percent of the world’s population. The proportion of individuals aged 80 or over is projected to rise from 1 percent to 4 percent of the global population between today and 2050.

Again, this data shows that the graph you posted that I keep calling "bupkis" is just that. It had dependent populations at 70% of working populations by 2050, something that would not seem realistic when it goes to age 64 and given the statement above that only 22% will be age 60 or higher (which would make that <20% age 65 or higher) and fertility rates of 2.5 (in 2005, projected to drop to 2 by 2050). :beer:
 
Again, this data shows that the graph you posted that I keep calling "bupkis" is just that. It had dependent populations at 70% of working populations by 2050, something that would not seem realistic when it goes to age 64 and given the statement above that only 22% will be age 60 or higher (which would make that <20% age 65 or higher) and fertility rates of 2.5 (in 2005, projected to drop to 2 by 2050). :beer:

Did you read the graph?

chart-of-the-day-dependents-as-a-percentage-of-the-labor-force-august-2012.jpg


The 70% dependency ratio is for developed countries, only.

Quoting from post 3302 http://appraisersforum.com/showpost.php?p=2283846&postcount=3302

The number of people over the age of 60 is projected to reach 1 billion by 2020 and almost 2 billion by 2050, representing 22 percent of the world’s population.

The 22% applies to the total world population. Makes a difference? :laugh:
 
The fact that some people over 60 are working is not a testament to a lack of a problem. It points to a problem that they have to work. And these aged people do not have the stamina and endurance that younger people have. Therefore they are not as productive as they once were.

In the 1930's a higher percentage of the population was engaged directly in agriculture and through the 1970's a higher percentages in heavy industry rather than the more common light industry we see today. Yeah, people wear out, but part of the reason more people are making it to age 65+ is that they are not wearing out quite as quickly nor are they being killed in work related accidents at the same rate either.


The working age population definition says nothing about labor participation rate. It means the burden of supporting all those not working or receiving benefits from government programs falls mainly on that group of people.

Gotcha ... how does this make the graph as presented "correct"?

In other words I am not saying I disagree with everything you are saying, but rather that the graph, as presented, was questionable at best. :peace:




Bottom line, there is a big problem aging that affects economic growth. It is being reported by researchers.

I agree, but what I have been trying to point out is that it is also being misrepresented by those with political agendas (and that one graph was obviously "wonky")
 
Gotcha ... how does this make the graph as presented "correct"?

Let me point you to the United Nation's web link to download the Excel file that you can easily perform your own graphing from the raw data to satisfy your complaint.

https://docs.google.com/viewer?url=...10_DB2_F05_1A_TOTAL_DEPENDENCY_RATIO_1564.XLS

Please post your graph of the dependent population ratio for: the world, more developed developed regions, and less developed regions.

What do you see?

In other words I am not saying I disagree with everything you are saying, but rather that the graph, as presented, was questionable at best.

If you have a data source that covers the same information as the United Nations, please post that information along with the graph.

I agree, but what I have been trying to point out is that it is also being misrepresented by those with political agendas (and that one graph was obviously "wonky")

You can be suspicious all you want to be. However, if there is truth in the trends on populations, it most definitely impacts negatively on economics and the wellbeing of countries.

In the 1930's a higher percentage of the population was engaged directly in agriculture and through the 1970's a higher percentages in heavy industry rather than the more common light industry we see today. Yeah, people wear out, but part of the reason more people are making it to age 65+ is that they are not wearing out quite as quickly nor are they being killed in work related accidents at the same rate either.

Just the obvious, how many construction workers do you see working at age 64 or older?

Most of the work done today by the population does not require physical exertion; it is largely sedentary (sitting on your arse or standing).

So definitely things have changed here and the world over. Work is mainly mechanized. Populations and societies are not family friendly today. And it shows in the fertility statistics.
 
Gotcha ... how does this make the graph as presented "correct"?

Here is a graph of the dependency ratio obtained from the raw data from the UN website that I made:


Dependency_ratio.jpg




Here is the dependency ratio graph as posted from a source:



chart-of-the-day-dependents-as-a-percentage-of-the-labor-force-august-2012.jpg



The above graph may appear distorted (subject to interpretation) but the information is accurate.

Did you notice the year 2015? All dependent population ratios are just about the same. The developed regions of the world are rapidly increasing.
 
The Dependency Ratio: Use This Number to Find the Best International Investments

http://www.investmentu.com/2010/January/the-dependency-ratio.html

America’s Dependency Ratio: Better Than Average Now… But Faces Problems Later

The current dependency ratio for the United States is 49%. That means for every 10 working adults, there are 4.9 people that need to be supported, be it through social security or childcare.

Therefore, a lower dependency ratio is better for economic growth. Not only does it mean more people in the workforce are contributing to national productivity, but also that more resources can be directed towards investments in growth initiatives.

The United States ranks pretty well, compared to a worldwide dependency ratio of 52%. But there’s more to it than that – two factors affect the dependency ratio…

  • Age: One way to get a lower dependency ratio would be to reduce the number of people above 65. Thankfully, though, nobody will try to do that without a major international outcry!
  • Birthrate: Over the past 30 years or so, the American “baby-boomer” generation has fattened up the U.S. working-age population. That’s kept the dependency ratio low and resulted in much of the growth since World War II. Unfortunately, this will come back to haunt us…

Why the United States Could Struggle with Economic Growth

With baby-boomers now entering retirement age, it will hike the dependency ratio up and stifle economic growth.

Since birthrates are measurable and the population at various ages stays pretty consistent for about 70 or 80 years, dependency ratios are predictable well into the future. Here’s how the United States looks…

usa_dependency_ratio.jpg
 
Let me point you to the United Nation's web link to download the Excel file that you can easily perform your own graphing from the raw data to satisfy your complaint.

[url]https://docs.google.com/viewer?url=http%3A%2F%2Fesa.un.org%2Funpd%2Fwpp%2FExcel-Data%2FDB02_Stock_Indicators%2FWPP2010_DB2_F05_1A_TOTAL_DEPENDENCY_RATIO_1564.XLS[/URL]

Please post your graph of the dependent population ratio for: the world, more developed developed regions, and less developed regions.

What do you see?

That I obviously need to track down whomever is making those time machines that allow travel to 2050 to gather all that "factual" data.

See, without explanation as to why the trends beyond 2010 or 2012 continue on that upwards slope the data is USE dot LESS.

What I still see is worst case speculation presented as "fact" to promote a political agenda. Before you try to say the UN isn't political let me put my drink down so I don't spray it all over the screen laughing.


You can be suspicious all you want to be. However, if there is truth in the trends on populations, it most definitely impacts negatively on economics and the wellbeing of countries.

Truth in the trends on population?
Third base!

So, why are we suddenly talking philosophy and religion rather than statistics and mathematical modeling?

"United Nations" is NOT the name of a scientist or statistician and statistics are BS unless they are accompanied by a document detailing exactly how they were collected and applied. Speculative analysis reporting is even more BS unless the report is properly supported with SOW used, and so forth ... you know, things you should already be familiar with given your profession.


Just the obvious, how many construction workers do you see working at age 64 or older?

My uncle retired last year, so at least one, and he retired so as to take care of his wife.
My father built a house after he retired aged 65.
So in my family for that generation 100% ;)
Can't say about my generation as the oldest cousin is only 60.

I can talk farmers, lumberjacks and such. My grandfather "retired" at age 64-ish after being gored, trampled and partially paralyzed by a bull, but otherwise he would have been still working the farm until age 80+ (he died age 90 even though bedridden since the accident). Do I need to describe the average retirement age of my father's generation? My father was happy that after he retired he had more time to spend up on the family farm helping with construction, including cement, block, beams, shingling and so forth ... often but his nieces and nephews to shame given how hard he worked.

So, like I said, every construction worker I know that has reached 65+ are still working or stopped working for other reasons (usually death).
 
See, without explanation as to why the trends beyond 2010 or 2012 continue on that upwards slope the data is USE dot LESS.

There are explanations that you can search out for yourself, to satisfy yourself.

What I still see is worst case speculation presented as "fact" to promote a political agenda. Before you try to say the UN isn't political let me put my drink down so I don't spray it all over the screen laughing.

Politics is politics, even as found in academia. The UN is a political body just as the Bureau of Labor Statistics is for the U.S.


"United Nations" is NOT the name of a scientist or statistician and statistics are BS unless they are accompanied by a document detailing exactly how they were collected and applied. Speculative analysis reporting is even more BS unless the report is properly supported with SOW used, and so forth ... you know, things you should already be familiar with given your profession.

Again, this data shows that the graph you posted that I keep calling "bupkis" is just that. It had dependent populations at 70% of working populations by 2050, something that would not seem realistic when it goes to age 64 and given the statement above that only 22% will be age 60 or higher (which would make that <20% age 65 or higher) and fertility rates of 2.5 (in 2005, projected to drop to 2 by 2050). :beer:
Did you read the graph?

chart-of-the-day-dependents-as-a-percentage-of-the-labor-force-august-2012.jpg


The 70% dependency ratio is for developed countries, only.

Quoting from post 3302 http://appraisersforum.com/showpost.php?p=2283846&postcount=3302



The 22% applies to the total world population. Makes a difference? :laugh:


Too bad you don't bother to read, you just make bogus claims.

Did you read the Harvard research paper that was posted for sources, methods and references?

Take a look:

Costa, D. (1998). The Evolution of Retirement: An American Economic History 1880-1990 . Chicago, University of Chicago Press.
Dor, A., C. Ferguson, C. Langwith, and E. Tan (2010). A Heavy Burden: The Individual Costs of Being Overweight and Obese in the United States". Research Report. George Washington University. http://www.gwumc.edu/sphhs/departments/healthpolicy/pdf/HeavyBurdenReport.pdf
Dychtwald, K. (1999). Ken Dychtwald on the Future. San Francisco Chronicle . San Francisco. November 15.
Ehrlich, P. (1968). The Population Bomb . New York, Ballantine Books.
European Commission (2010). "Green paper: Towards adequate, sustainable and safe European pension systems." http://ec.europa.eu/social/BlobServlet?docId=5551&langId=en
euobserver.com (2010). "Brussels suggests raising retirement age for EU citizens" http://euobserver.com/9/30160
European Union, Economic Policy Committee, Working Group on Ageing Populations and Sustainability. http://europa.eu/epc/working_groups/ageing_en.htm Accessed August 25, 2010.
Fogel, R. W. (1994). "Economic Growth, Population Theory, and Physiology: The Bearing of Long-Term Processes on the Making of Economic Policy." American Economic Review
84: 369-95.
Fogel, R. W. (1997). New Findings on Secular Trends in Nutrition and Mortality: So Implications for Population Theory. Handbook of Population and Family Economics . M. Rosenzweig and O. Stark, eds. Amsterdam, Elsevier. 1A.
Fries, J. (1980). "Aging, Natural Death and the Compression of Morbidity." New England Journal of Medicine 303: 130-35.
Greenspan, A. (2003). Aging Global Population. Testimony before the Special Committee on Aging, U.S. Senate .
Gruber, J. and D. Wise (1998). "Social Security and Retirement: An International Comparison." The American Economic Review 88(2): 158-163.
Heller, P. S. (2003). Who Will Pay: Coping with Aging Societies, Climate Change, and Other Long-Term Fiscal Challenges . Washington, D.C., International Monetary Fund.
ILO Bureau of Statistics (2009). ILO Database on Labour Statistics, International Labour Organization.
International Labor Organization (2008). "Can low-income countries afford basic social security?" Paper 3, Social Security Policy Briefings. Geneva: International Labor Organization.
Kelley, A.C. (2001). “The Population Debate in Historical Perspective: Revisionism Revised”, in Birdsall, N., A.C. Kelley, and S.W. Sinding, eds., Population Matters: Demographic Change, Economic Growth, and Poverty in the Developing World . Oxford: Oxford University Press. Pp. 24-54.
Krugman, P. (2010). "Attacking Social Security". The New York Times. August 15. Kulish, M., K. Smith and C. Kent (2006). "Ageing, Retirement and Savings: A General Equilibrium Analysis." Reserve Bank of Australia Research Discussion Paper (2006-06).

Lee, J. (2010). “Data sets on pensions and health: Data collection and sharing for policy design”. International Social Security Review . Special issue on "Social security and the challenge of demographic change".
Lee, R. (2000). A Cross-Cultural Perspective on Intergenerational Transfers and the Economic Life Cycle. Sharing the Wealth: Demographic Change and Economic Transfers between Generations . A. Mason and G. Tapinos. Oxford University Press: 17-56.
Lee, R. and A. Mason (2010). "Fertility, Human Capital, and Economic Growth over the Demographic Transition.". European Journal of Population 26: 159-182.
Loch, C.H., F.J. Sting, N. Bauer, and H. Mauermann (2010). “How BMW Is Defusing the Demographic Time Bomb.” Harvard Business Review . March. 99-102.
Lutz, W., A. Goujon, S. K.C., and W. Sanderson (2007). “Reconstruction of population by age, sex and level of educational attainment of 120 countries for 1970-2000”. Vienna Yearbook of Population Research, vol. 2007, pp 193-235.
Lutz, W., W. Sanderson and S. Scherbov (2008). "The Coming Acceleration of Global Population Ageing." Nature 451: 716-19.
Malthus, T. R. (1798). An Essay on the Principle of Population as It Affects the Future Improvement of Society, with Remarks on the Speculations of Mr. Godwin, M. Condorcet, and Other Writers . London, J. Johnson.
Mason, A., R. Lee, A.-C. Tung, M.-S. Lai and T. Miller (2006). "Population Aging and Intergenerational Transfers: Introducing Age into National Accounts." NBER Working Paper 12770.
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The following chart shows the dynamics of the dependency ratio for India and China, with the United States included for comparison.

saupload_p101110_1.png


It is not just that sometime around 2030, India's total population will become larger than China's. Total population is an ambiguous factor in prosperity, as those of us know who were raised on the intellectual sparring of Julian Simon and Paul Ehrlich. On the one hand, people are a country's most valuable resource; on the other hand, badly managed population growth can overtax other resources and leave a country populous but impoverished. Rather than total population, it is the inner dynamics of population growth, in particular, the evolution of the dependency ratio, that will make the difference for India and China.

The total dependency ratio is the ratio of the nonworking population, both children and the elderly, to the working age population. Low-income countries with fast population growth have high dependency ratios because they have lots of children. Rich countries with slow population growth have high dependency ratios because they have many retirees. In between these two states, countries go through a Goldilocks period when the working age population has neither too many children nor too many parents to support. The dependency ratio reaches a minimum, and growth potential reaches a maximum.

As the chart shows, India is just entering its Goldilocks period while China, like the United States, is already leaving. Furthermore, The dip in the Indian chart is more gradual and longer-lasting than the corresponding dip for China. For the next several decades, China will be tacking into the wind while India still has its spinnaker up. Chinese economic growth will slow, while India's, assuming a supportive policy environment, will edge past it.

What explains the difference in population dynamics? The answer can be found in the evolution of the total fertility rate in the two countries. (Total fertility is a measure of the number of children born to a representative woman over her lifetime.) China's total fertility rate dropped from almost six in 1965-70 to under three just a decade later. The famous one-child policy, introduced in 1978, contributed to the decline, but it was already well underway before that. By 1990-95, China's fertility rate had dropped below the replacement mark of about 2.1. In India, by contrast, the decrease in total fertility from six to three took 30 years to accomplish, and fertility is not expected to drop to the replacement rate until sometime in the coming decade. To switch metaphors, China slammed on the brakes, leaving big skid marks, while India made a more prudent deceleration. Furthermore, as Adam Wolfe, among others, has pointed out, China's official data may understate the true rate of decline in fertility, and therefore understate the future demographic drag on the country's growth.

There is nothing inherently wrong with slow, or even negative, population growth, but the transition to it is not easy to manage. The United States is not doing a particularly good job, as we know from the wrenching debate over the impact of social security and Medicare on the budget deficit. China is not doing well either. It has not yet found a social safety net to replace the long-vanished "iron rice bowl" of the Maoist era, and social insecurity, in turn, contributes to other imbalances in its economy. India, too, is not exactly a Swedish-style paradise for the young and the old, but at least it has more time to get its act together.

In short, India, by all indications, is likely to be the world's largest economy at the end of the 21st century. It appears that President Obama knew what he was doing when he endorsed India for a permanent seat on the UN security council during his recent South Asia visit. He wasn't just maneuvering to put together a coalition to contain China, as some commentators suggested. Instead, he was backing the probable winner in the global economic race.
 
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