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The fiscal impact of population aging in Sweden: 2015-2060

Pavlov, Oleksandr LU (2016) EKHM51 20161
Department of Economic History
Abstract
This study analyses the fiscal impact of population aging in Sweden from 2015 to 2060. We consider the three main areas of public spending in the demographic context: education, health care and pension. A separate analysis is performed for each of the three alternative macroeconomic scenarios, which are the status quo, the pension reform and the health care reform. Our results indicate that the old pension system, entirely financed by the state, is not sustainable, and thus the pension reform of 1994 was justified and is not likely to be changed in the future. The new pension system, however, is sustainable, since increase in the medical costs can be covered by pension savings and the GDP growth. Furthermore, we show that under the... (More)
This study analyses the fiscal impact of population aging in Sweden from 2015 to 2060. We consider the three main areas of public spending in the demographic context: education, health care and pension. A separate analysis is performed for each of the three alternative macroeconomic scenarios, which are the status quo, the pension reform and the health care reform. Our results indicate that the old pension system, entirely financed by the state, is not sustainable, and thus the pension reform of 1994 was justified and is not likely to be changed in the future. The new pension system, however, is sustainable, since increase in the medical costs can be covered by pension savings and the GDP growth. Furthermore, we show that under the assumption of technological progress in medicine the current health care system will become unsustainable in the presence of population aging. Therefore, a health care reform decreasing the share of state financing appears as a necessary solution to keep the fiscal balance in the long run. (Less)
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author
Pavlov, Oleksandr LU
supervisor
organization
course
EKHM51 20161
year
type
H1 - Master's Degree (One Year)
subject
keywords
Population aging, public expenditures, pension reform, health care reform
language
English
id
8879967
date added to LUP
2016-06-22 13:32:04
date last changed
2016-06-22 13:32:04
@misc{8879967,
  abstract     = {This study analyses the fiscal impact of population aging in Sweden from 2015 to 2060. We consider the three main areas of public spending in the demographic context: education, health care and pension. A separate analysis is performed for each of the three alternative macroeconomic scenarios, which are the status quo, the pension reform and the health care reform. Our results indicate that the old pension system, entirely financed by the state, is not sustainable, and thus the pension reform of 1994 was justified and is not likely to be changed in the future. The new pension system, however, is sustainable, since increase in the medical costs can be covered by pension savings and the GDP growth. Furthermore, we show that under the assumption of technological progress in medicine the current health care system will become unsustainable in the presence of population aging. Therefore, a health care reform decreasing the share of state financing appears as a necessary solution to keep the fiscal balance in the long run.},
  author       = {Pavlov, Oleksandr},
  keyword      = {Population aging,public expenditures,pension reform,health care reform},
  language     = {eng},
  note         = {Student Paper},
  title        = {The fiscal impact of population aging in Sweden: 2015-2060},
  year         = {2016},
}