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ACKNOWL EDGMEN TS
Preparation of this review was supported by grants to L.K.T.
from the Biotechnology and Biological Sciences Research Council
(grant number BB/H008217/1) and the European Research
Council under the European Community's Seventh Framework
Programme (FP7/2007-2013)/ ERC Grant agreement no. 249640.
The authors thank W. Marslen-Wilson, M. G. Shafto, and S. Shafto
for helpful comments on an early draft and D. Samu and
D. Meunier for help with figure preparation.
10.1126/science.1254404
REVIEW
Economic and social implications
of aging societies
Sarah Harper
The challenge of global population aging has been brought into sharper focus by the financial crisis
of 2008. In particular, growing national debt has drawn government attention to two apparently
conflicting priorities: the need to sustain public spending on pensions and health care versus the need
to reduce budget deficits. A number of countries are consequently reconsidering their pension
and health care provisions, which account for up to 40% of all government spending in advanced
economies. Yet population aging is a global phenomenon that will continue to affect all regions of the
world. By 2050 there will be the same number of old as young in the world, with 2 billion people aged
60 or over and another 2 billion under age 15, each group accounting for 21% of the world’s population.
By the end of the 21st century, demographic
trends will converge with declining births,
stabilization in population size, and aging
populationsacrosstheglobe(1). The age
composition of the world’s population will
alter as median ages rise and a proportionate shift
from younger to older people continues. At the
turnofthemillennium,thereweremorepeople
over 60 than under 15 in Europe. North America
will follow by 2030, Latin America and Asia by 2040.
In terms of absolute numbers, the Asian/Pacific
region is already the oldest, and by the middle of
the century will hold two-thirds of the world’s
then 2 billion elders (aged 60 years or over). The
worldwide numbers of those aged 80 and above will
show an even greater rate of increase, rising from
69 million to 379 million by 2050, when nearly 10%
of the developed world will be over 80 (1)(Fig.1).
Europe’s demographic structure in particular
is predicted to age substantially. By 2060, those
under 15 in the EU27 countries (European Union
members, 2007–2013) will be around 14%. There
will be nearly twice that proportion over 65, as
this age group will increase from 87.5 million in
2010 to 152.6 million by 2060. Perhaps most
striking of all, those aged 80 and over will constitute
around 12% of the European population; this group
is expected to almost triple in size, from 23.7 million
in 2010 to 62.4 million in 2060. The demographic
outlier is Africa, which will continue to grow and
remain young, with one-third of its population still
under 15 by the middle of the century (1).
Drivers
The conventional belief is that population aging
is driven by falling mortality rates and increasing
longevity. Although this is an important com-
ponent of the process, it is widely accepted that
the major driver is falling fertility, which funda-
mentally alters the subsequent age structure of a
population and, if sustained, leads to increasing
median ages and demographic aging (2).
Falling fertility or childbearing
Two-thirds of the world’s countries now have
childbearing rates or total fertility rates (3)near
or below replacement level, crudely defined as
2.1. These are diverse and drawn from most world
regions, including Asia (for example, Hong Kong,
SCIENCE sciencemag.org 31 OCTOBER 2014 •VOL 346 ISSUE 6209 587
Oxford Institute of Population Ageing, University of Oxford,
Oxford OX2 6PR, UK. E-mail: sarah.harper@ageing.ox.ac.uk
Males Females
Males Females
2010
Age group
100+
95-99
90-94
85-89
80-84
75-79
70-74
65-69
60-64
55-59
50-54
45-49
40-44
35-39
30-34
25-29
20-24
15-19
10-14
5-9
0-4
300 300200 200100 1000
2050
100+
95-99
90-94
85-89
80-84
75-79
70-74
65-69
60-64
55-59
50-54
45-49
40-44
35-39
30-34
25-29
20-24
15-19
10-14
5-9
0-4
300 300200 200100 1000
Population (millions)
Fig. 1. World population pyramids. Population
age structure for 2010 and projections for 2050
are shown. The working-age proportion is shown
in red. Source: (1).
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Singapore, Korea, Japan, Thailand, Myanmar,
and Vietnam), the Americas (Argentina, Chile,
Canada, and the United States), the Middle East
and Africa (Mauritius, Iran, Tunisia), and Europe
(every EU27 country, with a EU average of 1.6) (4)
(Fig. 2).
Such low fertility may be due to technological
advances and changes in the labor market that
have altered the costs and rewards of marriage
and child rearing (5–7). It may be that ideational
changes have accompanied increased affluence,
leading to a focus on individual autonomy and
self-realization (8,9). Some demographers ar-
gue that the evolutionary link between sexual
activity and procreation has been broken through
the introduction of modern contraception, and
that reproduction is now merely a function of
individual preferences and culturally determined
norms (10,11).
Some Asian and European countries may
well be in a so-called low-fertility trap (12). This
can result from both demographic and soci-
ological factors: Fewer potential mothers in
thefuturewillresultinfewerbirths,while
ideal family size is declining among younger
generationsasaconsequenceofthelower
childbearing they see in previous generations
(12,13).
Falling mortality
A second key driver is falling mortality or death
rates. Until recently, declines in mortality were
focused on infant and child deaths. As more
and more young people survived, the average
life expectancy of the population increased. In
advanced economies throughout the 20th cen-
tury, there was a steady reduction in mortality
across the life course. In mid-19th-century En-
gland, for example, half the population had died
before their mid-40s. Today, half the English
population can expect to survive until their
mid-80s.
The drivers of life extension appear to be
fourfold: healthy living, disease prevention and
cure, age retardation or senescence prevention,
and regenerative medicine. The first two brought
us gains in life expectancy from birth seen over
the past 150 years. They now promise to extend
life expectancy for many in the advanced econ-
omies to over 100 this century (14).
Will increases in life expectancy be accom-
panied by increases in life extension, or will we
see a compression of longevity after age 100? In
countries such as Japan where there are suffi-
cient numbers of very old people, the distribu-
tion of deaths above the mode is sliding to
higher ages. This “shifting mortality”scenario
suggests that with an increase in centenarians
we should also expect to see an increase in su-
percentenarians. However, successful age re-
tardation and regenerative medicine may be
needed to achieve real radical extension of hu-
man life (15).
Implications
It has long been recognized that population
aging has implications for societies and econo-
mies (16). It affects labor markets, patterns of
saving and consumption, families and house-
holds, networks and social interaction, health
and welfare services, housing and transport, and
leisure and community behavior. In addition, the
knowledge of both longer lives and the aging of
the population influences not only social and
economic policy and political decisions, but also
the attitudes and behaviors of individuals (17,18).
Are the financial and health institutions and
programs designed for the demographic struc-
ture of the 20th century appropriate for the
21st century? Of particular interest is the ca-
pacity of individuals and households to make
the relevant adjustments (e.g., to savings be-
havior, labor productivity, family and intergen-
erational transfers, and investment in their own
human capital) and the capacity of 21st-century
institutions to make the relevant adjustments
to facilitate this.
As discussed above, the aging of populations
is caused by two distinct trends: Older people
are living longer, and at the same time younger
people are having fewer children. The resulting
challenges can be grouped into those that arise
from (i) persistent below-replacement fertility
and the changing age structure of the popula-
tion, (ii) the increasing longevity of the older
population, and (iii) the interaction of the two.
Decreased fertility leads to demographic defi-
cits and labor market concerns, in particular
over reduced economic growth and the ability
of nations to finance public welfare programs
at a time when the number and percentage of
those who are economically active are declin-
ing. Increased longevity raises concerns about
the capacity of nations to finance and recon-
figure health and long-term care provision, in
advanced as well as emerging economies. Em-
erging economies will still be tackling acute
and infectious diseases and relatively high lev-
els of infant and child mortality, while at the
same time addressing a growing number of
frailer older adults who require long-term care.
The interaction of the two trends creates chal-
lenges around issues of inter- and intragenera-
tional fairness—that is, fairness and equity within
and between different generations.
Demographic deficits and labor
market concerns
Declining and aging populations are often viewed
as having negative effects on economic growth
and employment (19,20). These concerns are
encompassed in the notion of the “demographic
deficit”(21). This relates to the age-structural
transition approach that examines the cohort
composition of a population, considering the
proportion of old and younger dependents in
relation to productive adults, and how this will
alter over time. In general, productive capacity
varies across the life course, flowing from a pe-
riod of childhood dependency through high
productive potential in adulthood, then return-
ing to a decrease in productive capacity in old
age. The macroeconomic effects will differ de-
pending on the age composition of the popu-
lation. The decline in the proportion of younger
people in a population is perceived as leading
to a reduction in economic activity, whereas an
increase in the proportion of older people is
perceived as resulting in an economic burden
through the higher requirement for pensions
and health care.
588 31 OCTOBER 2014 •VOL 346 ISSUE 6209 sciencemag.org SCIENCE
Total fertility rates
2005 –2010
2.1 and under
2.2–3.1
3.2–4.1
4.2 and over
N/A
Fig. 2. Map of total fertility rates, 2005–2010. Total fertility rate, expressed as number of children per
woman, represents the average numberof children a hypothetical cohort of women would have at the end
of their reproductive period if they were subject during their whole lives to the fertility rates of a given period
and if they were not subject to mortality. Source: (1).
THE AGING BRAIN
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Much of this concern arises from an assump-
tion that the older labor forces of the future will
be less productive and less innovative, and that
an older population will have lower rates of con-
sumption. These preconceptions, however, are
contested by arguments that future cohorts with
higher levels of education, skills, and training will
be able to maintain high levels of productivity
given supportive and conducive working environ-
ments (21). In addition is the concern that older
people will be recipients of publicly funded pen-
sions for an increasing length of time, and will
also draw down on savings accumulated in both
private and national accounts (22).
In terms of the proportion of old and younger
dependents in relation to productive adults, most
industrialized countries will experience a rapid
shift toward increased elderly dependency ratios
[EDRs, defined as the number of persons of
working age (aged 15 to 64) per person aged 65
or over] over the coming decades (Fig. 3). For
example, the EU25 (European Union members,
2004–2006) (23) EDR is set to reach 51% by 2050,
as the working-age population (15 to 64 years)
decreases by 48 million between now and 2050,
and the number of those of working age per
older person 65+ will halve from 4 to 2 (24). Out-
side Europe, Japan and Korea will also age no-
tably. Korea, the most rapidly aging country, will
move from being the third youngest country in
the Organisation for Economic Co-operation and
Development (OECD) to the second oldest after
Japan by 2050, when Japan will have one of the
highest total dependency ratios (number of per-
sons aged 15 to 64 per person outside that range)
in the world at 74% in 2050.
Addressing the demographic deficit
At the macro level, many governments are ex-
ploring policies to compensate for, or even to
alter, the age composition of the population by
encouraging changes in fertility and migration
rates. Another approach is to tackle the labor
market directly, and to extend both the economic
activity and the general productivity of the older
population for as long as possible. This both re-
duces the need for social security provision for
some, and enables further financing of those who
arenolongerabletoremaineconomicallyactive.
In addition, there is a growing recognition tha t
many labor markets have the potential to increase
productivity through technological innovation.
Increase childbearing
The two main demographic solutions to the
dependency balance are to increase childbearing
and to increase migration. Although increasing
fertility rates can have a strong influence on al-
tering old-age dependency ratios, very few coun-
tries are currently pursuing an active fertility
promotion policy. However, there is recogni-
tion that “family-friendly”policies, aimed at
supporting both child and parents, can allow
women to have the number of children they de-
sire, which in most OECD countries tends to be
higher than the actual number of achieved
births (25–27). These policies include affordable
child care, parental leave, financial transfers, and
tax provisions.
Increase immigration
Alternatively, immigration is seen as a valid
policy approach (28). Because of the relatively
young age structure (and thus the labor poten-
tial) of immigrants, immigration has the poten-
tial to prevent population decline, maintain the
size of the labor force (and thus the support
ratio), and slow population aging. There are also
the indirect effects of migration on innovation,
economic growth, employment, and welfare. Im-
migration can affect the sustainability gap of
public finances as it increases the number of
potential taxpayers, even if the migrants’con-
tributions to the present budget are negative
(29). However, research has suggested that even
a considerable expansion of immigration will do
little to alter the predicted major capital short-
ages, tax increases, and reductions in real wages
that can be expected as countries progress through
the demographic transition (30).
Immigration can improve competitiveness and
productivity through new trade and international
linkages, encourage new investment, and increase
innovation and entrepreneurship. In advanced
aging economies, migrant workers fill the demand
for both highly skilled workers and unskilled
employment, particularly in the growing per-
sonal care sector.
Change dependency ratios by
working longer
In many advanced economies, the rising elderly
dependency ratios and the upcoming skills short-
age have already led to reconsideration of retire-
ment policies, leading to longer working lives
and a more gradual entry into retirement (31).
New cohorts of highly educated, skilled, and
increasingly healthy populations are delaying
retirement (32). This is in part a response to
government social security changes, but is also
due to the increased health status of these older
generations. Future generations of older adults
may have even higher levels of human capital—
in terms of education, skills, and abilities—and
better health profiles, and this will enable them
to remain active, productive, and contributory
for far longer, given supportive and conducive
working environments (2). This has ergonomic
and human resource implications for improving
physical and psychological working environments.
It also raises important questions around the
growing need for skills and training across
thelifecourse,andofwhowillpayforthis—
individuals, employers, or governments. In addi-
tion, the substantial contribution made by older
adults via the informal sector through providing
family and community support and care is now
increasingly being recognized (33).
Finance and reconfigure health and
long-term care provisions
Population aging heralds a series of challenges
for economies and societies in relation to the
provision of health and social care (34).
(i) The total amount of ill health and dis-
ability in the population will rise because as
societies improve their population life expect-
ancy, the proportion of the population with se-
rious health problems will increase unless there
is a considerable improvement in the health of
successive birth cohorts (which would manifest
as a decrease over time in age-specific preva-
lence rates). This has been termed “epidemic of
frailty”(35).
(ii) Changes in the type of ill health will arise
from the shift from acute infectious disease to
complex chronic long-term ill health and dis-
ability. This has been termed the chronic disease
burden (36,37) and will exert pressure for a
major shift in the allocation of health care re-
sources and the configuration of services.
SCIENCE sciencemag.org 31 OCTOBER 2014 •VOL 346 ISSUE 6209 589
OECD demographic decit
2000–2030
75 million
70
65
60
55
50
45
40 2000 2005 2010 2015 2020 2025 2030
Age 60-64
Age 20-24
Fig. 3. Demographic deficit in OECD member nations. Observed and projected size of the incoming
(20–24) and outgoing (60–64) working-age cohorts in OECD countries, 2000–2030.Source: OECD
figures, Oxford Institute of Population Ageing, 2012.
on May 8, 2017http://science.sciencemag.org/Downloaded from
Therefore, even if population aging does not exert
pressure for additional resources to be channeled
into the health care system, it is likely to exert pres-
sure for the development and improvement of ser-
vices for people with complex health needs, and thi s
may require a large shift in the allocation of
resourcesaswellaslarge-scaleorganizational
change.
(iii) Population aging will affect a society’s
capacity to provide workers to care for the older
population, as well as its ability to generate in-
come to finance this. The changes in the depen-
dency ratios discussed earlier will particularly
affect the health care sector. In addition, demo-
graphicchangewillreduceinformalfamilycare
through a reduction in the availability of younger
family members to provide such care. This will
increase the demand for formal care services, at a
time when the provision of overseas migrants
providing health care is reduced as their own
societies start to age. This will also occur at a
time when the epidemiological transition is toward
labor-intensive chronic disease c are.
Addressing the health and social
care challenge
One approach is to maintain health among older
populations for as long as possible, thus reducing
the requirement to provide and finance long-
term health and social care. A second approach
focuses on the economic relationship between
changing age structure and health care costs,
and how this might evolve with changing popu-
lation age structures.
Postponement of frailty and disability
Will declines in mortality be accompanied by
declines in morbidity (i.e., disease and disabil-
ity)? There is currently evidence that through
healthy living and disease prevention, the onset
of disability is being pushed back into our 80s
(38). Will these gains in healthy years continue as
we increasingly turn to science and technology
to extend our lives? The “compression of mor-
bidity”hypothesis (39,40) suggests that disabil-
ityandfrailtyarecompressedtowardtheendof
life at a faster pace than death rates. Therefore,
people are expected to live not only longer, but
also in better health. Alternatively, the “expan-
sion of morbidity”hypothesis (41–43)claimsthat
thedeclineinmortalityislargelyduetothede-
creasing death rate of diseases, rather than due
to a reduction in their incidence. As a result,
fallingmortalityisaccompaniedbyanincrease
in morbidity and disability. The “dynamic equi-
librium”hypothesis (44) suggests a counterbal-
ancing effect between the decreasing prevalence/
incidence of chronic diseases and the decreasing
fatality rates of such diseases. This is leading to
longer periods of living with disability toward
the end of one’slife.
The evidence is equally mixed. Studies from
the United States suggest that younger co-
horts of elderly persons are living longer in bet-
ter health (45); studies from Japan, the world’s
oldest country, suggest that as life expectancy
reaches very high ages, most of the gained years
are lived in poor health (46). For now we can
conclude that although both life expectancy and
healthy, disability-free life expectancy may be
increasing, disability as a proportion of life after
age 65 is also slowly increasing (47). Science,
technology, and medicine—the modern drivers
of longevity—are not only increasing our life ex-
pectancy but are also enabling us to live longer
at the end of our lives with disease, disabilities,
and frailties (Fig. 4).
Health care costs
Over the past 40 years, health care costs in most
advanced countries have been rising on average
between 1 and 2% faster than GDP (48). The age
structure of a population is seen to be an im-
portant determinant of health care costs. Costs
are high for infant and maternal care, and rise
again as we age, from around age 55 for men and
60forwomen.Yet,althoughpercapitahealth
spending does increase quite steeply once people
reach their 60s, repeated analyses of age-related
data on health spending have shown that prox-
imity to death is more important than age per
se as a predictor of the consumption of health
resources (49–51). In other words, health care
spending is heavily concentrated in the last few
years of life, so much so that some analysts have
argued that aging per se has virtually no effect on
the way that the consumption of health care
resources increases with age (52). However, in
many advanced economies, aging of the large
cohorts born in the middle of the 20th century
wil l over the coming decades increase the propor-
tion of the population in close proximity to their
death and will inevitably increase health care
consumption.
Although a number of cross-national studies
have considered the determinants of health care
costs, only one has found that the proportion of
population aged 65 and over is the explanatory
factor (53). Indeed, in advanced economies at
least, per capita health care costs for those aged
65 years and over have increased at the same rate
as for those aged less than 65 (54). In many
countries, per capita spending on health care is
reduced after age 85. This is partly due to the
view still held in many societies that spending
should be directed to the young when resources
are limited; partly due to the lack of research,
andthusinnovation,intreatmentsforthevery
old; and partly due to the lower demands made
by these cohorts relative to working-age adults.
All three factors are likely to change as the more
demanding younger cohorts reach old-old age.
It is the wider effects of income, lifestyle char-
acteristics, and new technology, alongside the
effects of environmental factors, that are driving
up the demand for new advanced medical appli-
cations. Indeed, technological change in health
care delivery has been the main driver, with up to
halfoftheincreaseinhealthcarespendingin
advanced economies over the past 50 years aris-
ing from medical technology (55). In addition,
medical innovations now allow for the treatment
of previously untreatable conditions, which also
increases medical costs (56).
Addressing the social challenge
Change in age composition is altering the struc-
ture of families and the life course. Such change
also brings into question the traditional contract
between the generations, and raises queries around
the reconfiguration of social institutions to deal
with issues of inter- and intragenerational fair-
ness that may arise as a result of population aging.
In particular, inequalities in access to health, eco-
nomic, and social resources—both between and
within generations—are likely to remain a press-
ing concern over the coming decades.
590 31 OCTOBER 2014 •VOL 346 ISSUE 6209 sciencemag.org SCIENCE
Increasing life expectancy and healthy life expectancy
2010 versus 2012
Life expectancy at birth
Healthy life expectancy at birth
years
90
80
70
60
50
40
30
20
10
02000 2012 2000 2012 2000 2012 2000 2012
LOW INCOME LOWER
MIDDLE INCOME
UPPER
MIDDLE INCOME
HIGH INCOME
Fig. 4. Life expectancy versus healthy life expectancy. Source: Life expectancy data by World Bank
income group; World Health Organization, Global Health Observatory Data Repository (http://apps.who.
int/gho/data/view.main.700?lang=en).
THE AGING BRAIN
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Changing family structures
Changes in fertility and mortality are leading to a
decrease in the number of living relatives within
each generation (16,57).As fertility falls, and as
the intervals between the generations increase
because of late first childbearing, we may well
see a contraction in the number of family gen-
erations alive at one time. Longevity is increasing
the duration spent in certain kinship roles, such
as spouse, parent of nondependent child, and
sibling. Falling fertility has reduced the duration
of others, such as parent of dependent child, or
even the opportunity for some roles, such as
sibling.
Delaying life transitions
Paradoxically, while public and legal institutions
are generally lowering the age threshold into full
legal adulthood, individuals are choosing to de-
lay many of the transitions into full adulthood—
full economic independence from parents, formal
adult union through marriage or committed long-
term cohabitation, and parenting—with a conti-
nued increase of age at first marriage, at leaving
the parental home, and at first childbirth. Within
the family, delayed transitions in younger life
lead to subsequent transition delay for both the
individual and other kin members. For example,
delayed birth of a first child may lead to a long
intergenerational interval and a later transition
to both parenthood and grandparenthood. Sim-
ilarly, extended economic dependence on parents
not only delays the individual’sfulltransitionto
independent adulthood, but also delays the ex-
perience of the empty-nest syndrome for the par-
ents themselves. Awareness of ever-lengthening
life spans may have given individuals at all ages
the time and the liberty to delay these transitions
as they progress through adulthood (16,18).
Inter- and intragenerational fairness and
the changing intergenerational contract
The question of intergenerational fairness raises
the issue of ensuring that both those generations
who are working and those who are now retired
will benefit from the proceeds of any economic
growth. These factors need to be addressed to-
gether with intragenerational inequalities, which
arise through differential access to education and
employment opportunities.
Thereisalsosomequestioningofthetradi-
tional contract between the generations, which
has been based historically on a system of inter-
generational reciprocity. Adults provide for young
dependents (children) and in return, when those
young dependents become adults, they provide
for older dependents. This is maintained in most
societies both directly at the familial level and at
a societal level, with adults within the labor mar-
ket providing via public transfers for both older
and younger dependents. The question for an
aging population is whether successful cohorts
(in terms of both fertility and mortality reduc-
tion) pass the cost of such success onto future
cohorts via the traditional intergenerational con-
tract or a renegotiated one. This latter contract
would require older cohorts to bear the costs of
their longer lives, through (for example) higher
postretirement contributions to their own wel-
fare and/or a longer working life.
Conclusion
A variety of new policies are now being devel-
oped in the light of population aging, including
broad, coherent, and integrated multi-pillar ap-
proaches to labor markets, health, and social
security (58).These should enable and promote
longer working lives through life long training,
education and skills updating, and the provision
of appropriate working environments for older
workers. They should further ensure that private
family or household transfers are integrated into
old-age security systems where possible; pro-
mote well-being and enable healthy active living
to reduce chronic illness and health care costs
and support active contributory life for as long as
possible; and provide access to education across
thelifecoursetoensurethatallindividualsare
prepared physically, mentally, socially, and finan-
cially to cope with increasing individual respon-
sibility for old age.
Moreover, it should be recognized that the
major concerns listed above are dynamics of
current cohorts and current behaviors. They
are not fixed. Europe, which has had more than
100 years to prepare for its aging population,
is still struggling with these questions. Yet the
greatest challenges of global population aging
may not be in Europe, but rather in the rap-
idly changing demography of Asia and Latin
America—regions that are moving from being
predominantly young to being predominantly
old within just 25 years.
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Sarah Harper (October 30, 2014)
Economic and social implications of aging societies
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