Abstract
In the next fifty years, the share of the world population aged 65 or older will double, the
average age will rise from 26.5 to 36.2, and the fast-growing 80+ age group’s share will
quadruple rising from 3% to 8% (UN Population Division 1998). What is more the
process is speeding up. Today, about two-thirds of all older people are living in the
developing world; by 2025, it will be 75%. Although some countries could be considered
to still be in the pre-transitional phase of the demographic transition with high fertility
and mortality rates, in most developing countries there will be a very significant increase
in the size of the population over 65 in the next 25 years. Medical advances, improved
diet and decreased fertility are the root causes of the aging boom the world’s elderly in
developing countries by 2050. This will put severe pressure on public finances and policy
responses will have to be both radical and relatively swift. Virtually all of the available literature on the costs of aging pertains to the developed
countries, which form part of the Organization of Economic Co-operation and
Development (OECD), and the bulk comes from the USA. These studies tend to fall into
two categories: the actuarial approaches and the micro-simulation models2
.