Evaluating public policy responses to the economic burden of population ageing with application to Australia

Abstract

This paper reviews the issues in evaluating public policy interventions that are designed to address the economic burden of population ageing. It then briefly reviews the main public policy options with application to Australia. The economic burden of ageing is defined as the burden on national economic well-being over time and the extent to which this burden is shared between the public and private sectors. A key policy issue is the extent to which the economic burden of ageing should be spread out over present and future generations. This depends on how we value the economic well-being of future generations relative to our own, future projections of economic growth, and the rate at which our subjective sense of well-being improves with our living standards. The paper discusses policies to boost the labour force participation rates of older workers, measures to boost fertility and immigration policy. Also discussed are several policies to shift the burden of ageing from the public to private sectors: the establishment of government financial funds such as the Future Fund, superannuation policy, and health and aged care policy.