Declining birth rates around the world have gotten many people worried about the economic impact, with predictions of slower growth and less innovation. But a new paper finds that the opposite may be true.
Aging and shrinking populations have historically raised an economy’s output per worker and had no damping effect on overall gross domestic product, according to a new study by Daron Acemoglu — who won the Nobel economics prize in 2024 — David Autor, Keelan Beirne and Andrew Scott. It finds that workers and companies turn to technology to augment a reduced labor force, raising the productivity of each worker.