The change that demography has motivated along with the economic development that has increased the quality of life, in the concept of old age, has been the transition from a static concept, to a dynamic one, where old age has associated stages in its interior, the labor extension of the people, as well as the degree of dependence, according to the evolution of the physical and mental capacities. As a result, age ceased to be the sole determinant of old age, while to explain it, elements associated with economic growth, advances in health and the economy have already begun to play, which as it has increased the population of third age in the percentage of their age structure, are increasing the degree of participation of the elderly in the labor market.
In addition, if life expectancy is increased, and fertility and migration rates are reduced, the relative weight of the population over 65 will also increase, which will have to redefine the dependency relationship, which places at this age of 65 years, as an arbitrary limit, to consider a person of old age and economic dependence. The effects of demographics changes in cities are related to two topics in his research:
- Social Policy: Related to the role of the Government through economic policy, focused on employment, pensions and taxes, and how these three involve the support of the elderly population.
- Macroeconomic Environment – Social: Internal economic growth, behavior of the global economy, changes in demographic trends.
The consequence of the interaction of these four factors is the variation in the behavior of the older population in the labor market. Given that the participation of the population over 60 has increased in the economically active population, the concept of active aging begins to emerge, with which the transition is made from a negative to a positive perspective on aging and its impact in the economy.
What is the impact of demographic changes on Bogota’s economy? In an author’s econometric exercise, which includes the population over 60 years of age to explain the share of Bogota’s GDP in the National GDP, it is estimated that the GDP of Bogotá that today accounts for 26% of Colombia’s GDP, long term would do it in 21%.
By involving the increase in the relative weight of the population over 65 as a variable, in order to estimate long-term growth, Bogotá would reduce its potential growth by 0.6%. The Bogota´s GDP per capita (average income by person) exhibits significant volatility in its growth: the periods where it exhibits an upward trend have not been greater than periods of 5 years. The stability in the population growth of Bogota (1% to 2050) projects a lower volatility in the growth of the GDP per capita, which would converge to 3.6%, higher than the average observed of this indicator during the period 1985 – 2015 (2.6%).