Annals of the University of Oradea: Economic Science (Jul 2021)
CONSUMPTION EXPENDITURE OF THE ELDERLY IN THE EUROPEAN UNION: CONVERGENCE AND IMPACT ON GDP
Abstract
In the context of an ageing population, the aim of this study is to analyze how the consumption expenditure of the age group 50 plus affected the GDP growth rate during the period 2005-2019, at the level of the European Union countries. Using spatial econometrics, we study the convergence process of both the consumption expenditure of the 50 plus age group and the GDP. Furthermore, we analyze the relationship between the two variables and its evolution in time. We conclude that there is a bidirectional relationship between the studied variables: an increase in the growth rate of the 50 plus age consumption significantly and positively impacts the GDP growth rate and vice versa. At the level of Western European states where the share of 50 plus population is the highest, the impact on GDP growth rate is stronger. The results are relevant for further identifying possible economic opportunities created by the ageing population while supporting the European Union cohesion policy through the convergence process aimed at reaching an overall harmonious development within the member states and regions.
