Four Mechanisms for Growth in Demographic Dividend

There are four main areas where a country can find demographic dividends:

• Labour Supply: The first is the increased labour supply. However, the magnitude of this benefit appears to be dependent on the ability of the economy to absorb and productively employ the extra workers rather than be a pure demographic gift.
• Savings: The second mechanism is the increase in savings. As the number of dependents decreases individuals can save more. This increase in national savings rates increases the stock of capital in developing countries already facing shortages of capital and leads to higher productivity as the accumulated capital is invested.
• Human Capital: ....