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Category: Analysis

Description: European regions experience accelerating ageing, but there is substantial regional variation in the process. This paper examines the effect of this variation on regional economic cohesion in Europe. We measure the effect of convergence or divergence in the share of the working age population on convergence or divergence in economies of NUTS 2 regions. The effect of convergence or divergence in ageing on economic convergence or divergence has been smaller than the effect of changes in productivity and labour force participation; yet, this effect was still quite substantial. Convergence of ageing leads only to economic convergence when the share of the working age population in rich regions exceeds that in poor regions and the former regions experience a substantial decline in the share of the working age population or the latter regions experience an increase. Our empirical analysis shows that in the period 2003-2012 an inverse relationship between convergence in ageing and economic convergence was the rule rather than the exception.