Demographic changes, saving, and current account: An analysis based on a panel VAR model

Soyoung Kim, Jong Wha Lee

Research output: Contribution to journalArticlepeer-review

33 Citations (Scopus)


This paper empirically investigates the macroeconomic effects of demographic changes, focusing on saving rates and current account balances. The econometric investigation based on the panel VAR model shows substantial demographic effects on national saving rates and current account balances in the major advanced (G-7) countries. An increase in the dependency rate significantly lowers saving rates, especially public saving rates. Further, a higher dependency rate significantly worsens current account balances.

Original languageEnglish
Pages (from-to)236-256
Number of pages21
JournalJapan and the World Economy
Issue number2
Publication statusPublished - 2008 Mar

Bibliographical note

Funding Information:
We are grateful to Warwick McKibbin, Kwanho Shin, an anonymous referee, and seminar participants at the Australian National University and Korea University for helpful discussions and Jong Duk Kim for valuable research assistance. This research was a part of the Research Project on Aging in East Asia at Hosei Institute of Aging, Hosei University supported by the Ministry of Education, Japan.


  • Current account
  • Demographic changes
  • Panel VAR
  • Saving

ASJC Scopus subject areas

  • Finance
  • Economics and Econometrics
  • Political Science and International Relations


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