How an Aging Population Can Affect Innovation and Economic Growth

The less well-known effect of an aging population is that it affects the makeup of the workers in the population. Young people have more fluid intelligence, which complements the crystallized intelligence of older workers. In an aging society, there is a relative shortage of fluid intelligence, leading to less innovation and productivity growth. Additionally, elderly voters may be less likely to support policies that promote economic growth. This can result in an ossification of the economy and a significant economic loss over time.