Aging in the Asian “Tigers”: Challenges for Fiscal Policy
IMF Working Papers, October 1, 1997
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- Aging in the Asian “Tigers”: Challenges for Fiscal Policy
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Bibliographic details
- Authors: Peter S. Heller
- Published: October 1, 1997
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781451856309.001
Summary
- The paper assesses the government expenditure effects from changing demographics in the Asian “Tiger” economies through 2050.
- With some exceptions, the Tigers’ limited social insurance commitments initially suggest that aging populations may not adversely affect fiscal balances.
- Changing illness patterns and medical modernization may combine with demographics to intensify budgetary pressures across all the Tigers.
- The paper notes the implications of the Tigers’ reliance on private sector pension and medical insurance systems; the need for an active public role; and the complications for fiscal analysis when private sector instruments are used, in a mandatory way, as public policy instruments.
Major findings and projections
- Time horizon for demographic assessment: through 2050.
- Initial fiscal implication: limited social insurance commitments imply aging may not immediately worsen fiscal balances (with some exceptions).
- Emerging fiscal pressures: interaction of changing illness patterns and medical modernization with demographic aging could intensify budgetary pressures for all the Tigers.
- Institutional implication: reliance on private-sector pension and medical insurance systems affects public fiscal exposure and analysis, particularly where private instruments are used mandatorily as public policy tools.
Policy implications and recommendations
- Recognize the potential for rising budgetary pressures from the combination of demographics, changing illness patterns, and medical modernization.
- Reassess the public role given heavy reliance on private sector pension and medical insurance systems.
- Account for complications in fiscal analysis introduced when private sector instruments are used, in a mandatory way, to achieve public policy objectives.
Content in this bundle
- Aging in Asian "Tigers": Challenges for Fiscal Policy - WP/97/143