Macroeconomic Consequences of Demographic Change: Modeling Issues and Applications

Book/Chapter
Macroeconomic Consequences of Demographic Change: Modeling Issues and Applications
Rausch, S. (2009)
Lecture Notes in Economics and Mathematical Systems, Lecture Notes in Economics and Mathematical Systems,Vol. 621, Springer: Heidelberg, Berlin, New York, 135 p.

Abstract/Summary:

This book presents a new computational approach to solving large-scale Auerbach-Kotlikoff Overlapping Generations (OLG) models in a complementarity format. Unlike with integrated solution methods, the proposed decomposition algorithm allows for the solution of multi-regional and multi-sectoral OLG models that exhibit a large number of heterogeneous consumers and a variety of household-specific effects. By broadening the scope of economic analysis, this new approach provides a powerful tool for applied general equilibrium modelers. In this book, the algorithm is applied to the macroeconomics of demographic change, demonstrating its flexibility and scope as a solution concept. With a specific analysis on the implications of globally unsynchronized demographic patterns for international trade, the book also explores the sectoral and distributional consequences of an aging population in Germany.

Citation:

Rausch, S. (2009): Macroeconomic Consequences of Demographic Change: Modeling Issues and Applications. Lecture Notes in Economics and Mathematical Systems, Lecture Notes in Economics and Mathematical Systems,Vol. 621, Springer: Heidelberg, Berlin, New York, 135 p. (http://www.springer.com/economics/macroeconomics/book/978-3-642-00145-1)
  • Book/Chapter
Macroeconomic Consequences of Demographic Change: Modeling Issues and Applications

Rausch, S.

Lecture Notes in Economics and Mathematical Systems,Vol. 621, Springer: Heidelberg, Berlin, New York, 135 p.

Abstract/Summary: 

This book presents a new computational approach to solving large-scale Auerbach-Kotlikoff Overlapping Generations (OLG) models in a complementarity format. Unlike with integrated solution methods, the proposed decomposition algorithm allows for the solution of multi-regional and multi-sectoral OLG models that exhibit a large number of heterogeneous consumers and a variety of household-specific effects. By broadening the scope of economic analysis, this new approach provides a powerful tool for applied general equilibrium modelers. In this book, the algorithm is applied to the macroeconomics of demographic change, demonstrating its flexibility and scope as a solution concept. With a specific analysis on the implications of globally unsynchronized demographic patterns for international trade, the book also explores the sectoral and distributional consequences of an aging population in Germany.