Relationship between Economic Development and Population Ageing: An Empirical Study on Selected States of India

Abstract

The existing literature suggests that there is some relationship between population ageing and economic development; as population ageing is faster in developed countries relative to the developing countries. The authors in the paper tried to explore this fact in the context of the selected states of India. The authors measured the level of the economic development in all states of India at three points of time -1981,1991, and 2001. The level of economic development was measured by constructing an Index of Development assigning appropriate weight to the variables by applying Factor Analysis. On the basis of the values of the Index of Development, all the states were ranked, and then the top five states and the bottom five states, i.e., the most developed states and the least developed states in the year 2001 were taken as base year to examine the pattern of population ageing in those selected states. Next, the authors estimated the ageing of the population in the selected states at three points of time, 1981,1991, and 2001 by applying the measures - Ageing Index and Rate of Demographic Ageing. Finally, the percentage change in the level of economic development of the selected states over the periods 1981-2001 (20 years) was arrayed against percentage change in the process of population ageing over the same period in the same set of states to have a clear idea about the connection between economic development and population ageing. The results of the study present some interesting findings. Firstly, there is convergence in growth of economic development in the selected states. Secondly, the population ageing was found to be faster in relatively developed states of the country. Although not very consistent, the results reveal a pattern that suggests that the different states of India, irrespective of their level of economic development, are at different stages of population ageing.