Dynamic Impact of Population Aging on Regional Economies in Korea Using a Recursive-Dynamic Interregional CGE-Population Model

Euijune Kim, Geoffrey J. D. Hewings, Changkeun Lee

Research output: Chapter in Book/Report/Conference proceedingChapter

Abstract

This chapter estimates dynamic effects of population aging on regional economies using a recursive-dynamic interregional CGE-Population model of Korea. The model accounts for the economic behavior of producers and consumers on the real side economies of two regions: the Seoul Metropolitan Area and the rest of Korea. Population demographics in each region are disaggregated into eight age cohorts that have different labor productivities and participation rates on the supply side and consumption behaviors on the demand side. The aging trend could have negative effects on the economy, reducing the GDP by 2.37 % on a 15-year average. The economic recovery from this decline could require an annual increase in educational investments on age cohort 20--29 by at least 12 % for 15 years. It implies a net increase rate of 4.60 % because the educational investments have increased annually by 7.40 % since 2007.
Original languageEnglish (US)
Title of host publicationRegional Growth and Sustainable Development in Asia
EditorsAmitrajeet A. Batabyal, Peter Nijkamp
PublisherSpringer
Pages201-219
Number of pages19
ISBN (Electronic)9783319275895
ISBN (Print)9783319275871, 9783319801780
DOIs
StatePublished - 2017

Publication series

NameNew Frontiers in Regional Science: Asian Perspectives
ISSN (Print)2199-5974
ISSN (Electronic)2199-5982

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