Hong Kong Special Administrative Region: Macroeconomic Impact of an Aging Population in a Highly Open Economy

 
Author/Editor: Leigh, Lamin
 
Publication Date: March 01, 2006
 
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Disclaimer: This Working Paper should not be reported as representing the views of the IMF. The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate
 
Summary: Hong Kong SAR's population is aging rapidly. This paper concludes that, without a change in policies, aging could adversely affect growth and living standards. While higher labor productivity growth and increased migration of younger skilled workers from the Chinese mainland, would attenuate the economic impact of aging, they would not offset it fully. Aging will also put pressure on public finances, particularly as a result of rising health care costs. There is a relatively narrow window of opportunity to implement policies to lessen the impact of aging, given that the demographic effects could start setting in as early as 2015 when the working population's support ratio peaks. In recent years, the Hong Kong SAR authorities have been focusing on policies that could help limit the fiscal impact of aging, including continued expenditure restraint on non-age-sensitive areas, reform of health care financing (including introducing private health insurance system), and tax reforms.
 
Series: Working Paper No. 06/87
Subject(s): Aging | Fiscal policy | Health care | Hong Kong SAR | Labor productivity

Author's Keyword(s): Aging | productivity growth | fiscal impact | health care costs
 
English
Publication Date: March 01, 2006
ISBN/ISSN: 0 / 1934-7073 Format: Paper
Stock No: WPIEA2006087 Pages: 19
Price:
US$15.00 (Academic Rate:
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