Problems of Aging Society
Aging society is the definition for the society where birth rates are extremely low compared to the elder population rates. The distribution of ages of population can be shown by the upside-down pyramid in the elder society, while the regular shape of the pyramid reflects the ideal population rates. Since society gets more and more of senior citizens, it causes lots of drawbacks: slows down economic growth, lowers GDP per capita and Real GDP, and lowers personal expenditures. Due to these disadvantages, it has been one of controversial issues over the entire nation. Therefore, I think the dramatic increase in the aging population, along with the low fertilization rates, is causing negative effects on the nation.
The cons of the rise in elder population in the society are tardy in economic growth and lowering GDP. The reason why it slows down the economic growth of one country is because of population changes from an aging society. The population is one of the factors that affects the economy, and it also plays an important role in resource availability. However, while there is faint potential for an increase in the birth rate, the number of elder people in the community increases in a huge number; therefore, a country experiences low labor productivity, the amount of output per unit of labor, which leads to diminishing potential economic growth. Furthermore, changes in age of the population lowers the GDP per capita by reducing one’s income. Therefore, these factors abate prospect economic growth, which is measured by resource availability and productivity.
The other disadvantage of rise in the older population is lowering Real GDP by changing consumer propensity to consume. While the increase in the number of older people makes people spend on health insurances more, the low fertilization rates, which comes from the aging issues, reduce personal consumption. It is because the consumer propensity to consume changes from tuition, academic related fees, clothing, and foods to health related products — health insurance. In addition, due to the changes in preference of consumption, it lessens the consumer expenditures, which lowers the Real GDP. Therefore, the aging population, along with the low birth rate, decreases the Real GDP, which leads to negative effects on countries’ economies.
Gaining senior citizens only in our community is negatively affecting our economy from many aspects. It affects the economy by slowing down the economic growth of one country by lowering three types of GDP — GDP, Real GDP, and GDP per capita — and changing personal expenditures. Also, the aging issue has been left without a proper remedy in the entire country; so, it is considered to be serious problems in some countries that already face the issue. Therefore, the problem of extreme increase in the population of elders, along with an inferior rate of birth, is harmful for our economy due to the drawbacks that come from the problem of aging.
References
Kacapyr, Elia, James Redelsheimer, and Frank Musgrave. 2021. Barron’s AP Microeconomics/Macroeconomics : With 4 Practice Tests. New York: Kaplan Inc.
“The Economic Impact of Falling Birth Rates: ISA.” n.d. Www.isa-World.com. https://www.isa-world.com/news/?tx_ttnews%5BbackPid%5D=1&tx_ttnews%5Btt_news%5D=485&cHash=8066cd77ac69cb1e4a967f1e527fafdd.
