Demography and Productivity: The Effect of Labor Force Composition by Age and Gender
Lee, Yoon Jung
Demographic composition is changing rapidly throughout the world. While ageing population is a global phenomenon, the speed of the change is much faster in developed countries than developing countries, which affects the age composition of labor.This paper examines the age composition of the labor force of 67countries between 1992 and 2007 and its relationship with total factor productivity (TFP), to conclude that 1) age composition of the labor force is strongly related to productivity, and 2) the high ratio relatively older labor force, which generally peaks at the age group between 40-49, adds to productivity.Though female labor force is generally U-shaped, unlike the inversely U-shaped productivity contribution of the labor force above, female labor contribution also peaks at relatively older labor force, especially in the advanced economies.
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