Demographics and the U.S. Economy

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dc.contributor.authorBarro, Jorgeen_US
dc.contributor.orgJames A. Baker III Institute for Public Policyen_US
dc.date.accessioned2023-04-05T16:04:53Zen_US
dc.date.available2023-04-05T16:04:53Zen_US
dc.date.issued2022en_US
dc.description.abstractHow much can demographic changes account for trends in the U.S. economy? This paper shows that a heterogeneous-agent, overlapping-generations model with historical demographic flows can generate several features of the U.S. economy over the past several decades, including a secular decline in economic growth, a rise in savings relative to GDP, a corresponding decline in real interest rates, and, in part, changes in wealth inequality. Simulations show that education and immigration contributed to these trends, but the main driver was an aging of the U.S. population driven by declining birth rates and increased life expectancy. Counterfactual analysis shows that increased immigration can improve near-term economic growth (total and per capita) and offset some aging of the population. However, there is little that realistic policy intervention can do to offset these trends in the long-run.en_US
dc.identifier.citationBarro, Jorge. "Demographics and the U.S. Economy." (2022) James A. Baker III Institute for Public Policy: <a href="https://www.bakerinstitute.org/research/demographics-and-us-economy">https://www.bakerinstitute.org/research/demographics-and-us-economy</a>.en_US
dc.identifier.digitalCPF-Barro-demographics-economy-111122en_US
dc.identifier.urihttps://hdl.handle.net/1911/114549en_US
dc.publisherJames A. Baker III Institute for Public Policyen_US
dc.relation.urihttps://www.bakerinstitute.org/research/demographics-and-us-economyen_US
dc.rights© 2022 Rice University’s Baker Institute for Public Policyen_US
dc.titleDemographics and the U.S. Economyen_US
dc.typeWorking paperen_US
dc.type.dcmiTexten_US
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