Immigration and growth in an ageing economy
Joan Muysken & Thomas Ziesemer
#2011-012
This paper argues that immigration can help to alleviate the burden
ageing presents for the welfare states of most Western Economies. We
develop a macroeconomic framework which deals with the impact of both
ageing and immigration on economic growth. This is combined with a
detailed model of the labour market, to include the interaction with
lowskilled unemployment. The empirical relevance of some crucial model
assumptions is shown to hold for the Netherlands, 1973 – 2007. The
conclusions are that immigration will help to alleviate the ageing
problem, as long as the immigrants will be able to participate in the
labour force at least as much as the native population. Moreover, the
better educated the immigrants are or become, the higher their
contribution to growth will be.
Key words: ageing; immigration; unemployment; skills.
JEL-code: E24, F22, O15, O52