NTA2020 Wongkaren

Global Meeting on Population and the Generational Economy, August 2020

Presentation: Turro Wongkaren, Diana Stojanovic, Generations and Demographic Dividends in Indonesia

Abstract

In this presentation we investigate several scenarios in which female labor force participation, elderly labor force participation, unemployment rates, and varying interest rates affect demographic dividends in Indonesia. We examine the conventional first (gain from the presence of increasing ratio of productive to nonproductive age) and second dividend (forward looking scenarios for financing old age consumption) as well as two special cases of ‘silver dividend’ (tapping into potential of employment by the elderly), and ‘gender dividend (allowing for higher than current female labor participation rates). Finally, we introduce the concept of generations and assign different life-cycle profiles depending on the generation each cohort belongs to. The demographic dividends are estimated using the National Transfer Accounts (NTA) framework. Population projections are based on the detailed model that takes into account fertility variations across educational levels of the mother. The results show that generational differences in economic life-cycle affect the lengths of the dividend period. We will discuss the effects for each of the demographic dividend type and touch upon how the disruption caused by the global pandemic will modify the effects via modified projected interest rates.

File: NTA2020 Wongkaren

Paper: NTA2020 paper Wongkaren

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