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LONGEVITY AND TECHNOLOGICAL CHANGE
Published online by Cambridge University Press: 06 September 2017
Abstract
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We analyze the impact of increasing longevity on technological progress within an overlapping generations research and development (R&D)-based growth framework and test the model's implication on Organization for Economic Co-operation and Development (OECD) data from 1960 to 2011. The central hypothesis is that—by raising the incentives of households to invest in physical capital and in R&D—decreasing mortality positively affects technological progress and productivity growth. The empirical results confirm the theoretical prediction. This implies that the demographic changes we observed in industrialized economies over the last decades were not detrimental to economic prosperity, at least as far as technological progress and productivity growth are concerned.
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Footnotes
We would like to thank the editor, William A. Barnett, an associate editor, an anonymous referee, Cristiano Antonelli, Giuseppe Bertola, James Fenske, Freddy Heylen, Andreas Irmen, Anastasia Litina, Inmaculada Martínez-Zarzoso, Alexia Prskawetz, Russell Thomson, the participants at the Annual Meeting of the German Economic Association 2016, the 1st CREA Workshop on Aging, Culture, and Comparative Development 2016, the MoPAct Workshop on Economic Aspects of Demographic Change 2016, and seminar participants at the University of Göttingen and at the University of Hohenheim for valuable comments and suggestions.
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