Demographic Dividend

The term “Demographic Dividend” refers to the economic growth potential that can result from shifts in a population’s age structure, particularly when the proportion of working-age individuals (typically ages 15-64) is larger than the non-working-age population (those below 15 and above 64). This scenario can lead to increased productivity and economic growth, provided that the appropriate investments in health, education, and job creation are made.

For example, many East Asian countries, such as South Korea and Taiwan, experienced significant economic growth in the late 20th century as their Demographics shifted, resulting in a higher proportion of working-age individuals. During this period, these countries invested heavily in education and technology, maximizing their demographic dividend.

Conversely, in countries like Japan, the demographic dividend has turned into a demographic burden due to an aging population and low birth rates, leading to a shrinking workforce and increased pressure on social services.