Geoscience Reference
In-Depth Information
Fig. 11.7
Gross regional product (ageing population)
happens because after an initial overshoot, the capital stock starts to decrease
gradually reflecting the fall in aggregate savings, and thus, two negative impacts,
smaller capital stock and labor force, fuel the decline in GRP. The decreasing GRP
leads, in turn, to a fall in the per capita GRP.
In contrast to the earlier finding, when an ageing population is considered in this
more behavioral manner, the income inequality declines rather than increases. A
major reason for this outcome may be traced to changes in social security payments
by wealthier workers, increased returns from assets and with more forward-looking
behavior, retirees will have more assets from which to draw income in retirement.
The earlier analysis failed to include the effect of assets (non wage and salary
income) and, increasingly, these will form a major part of the income base for
retirees.
11.3.2 Immigration, Ageing and the Regional Economy
This part of the analysis explores changes in the impacts of immigration policies; it
is assumed that the immigration policies between local and federal government are
differentiated. This differentiation is not in terms of issues such as quotas, visa
requirements, or guest worker programs but more in terms of a region's ability to
compete more effectively for the pool of in-migrants. Hence, it is assumed that the
local governments in the Chicago region implement a more favorable set of
incentives to attract more immigrants than the federal government (as a share of
total population). These might include housing subsidies, enhanced social and
health care programs, pro-active recruiting policies (through public-private
partnerships) and general enhancement of the current process of channelization of
immigrants flows (regions with high existing levels of immigrants have a higher
probability to compete more effectively for new immigrants using family and
community (Chicago)-to-community (source of
immigrants
in their home
country) ties.
