Aging of Population and Changes in Consumption Patterns: impacts on the production structure in Brazil

Abstract

The main objective of this paper is to analyze how the aging of the population could affect the Brazilian production structure, given the expected changes in consumption patterns of the population between 2005 and 2050. To achieve this objective an input-output analysis was used together with information from the 2008-2009 Consumer Expenditure Survey (POF), the 2005 National Household Sample Survey (PNAD) and a projection of Brazil’s population by sex and age between 1980 and 2050. The most important results were that: a) the products most heavily consumed in elderly households were Financial Intermediation and Insurance, the Health Market, Domestic Services, and Pharmaceutical Products, whereas in non-elderly families more was spent on Private Education, Clothing, Footwear and Leather Products, Passenger Transport, and Lodging and Food; b) when the production required to satisfy household consumption in the years analyzed was compared, it was found that the sectors with the highest growth rates are likely to be those responsible for products with higher consumption among elderly families, especially the areas of Pharmaceutical Products, Health Care, Financial Intermediation and Insurance, Other Services, Medical and Hospital Devices and Instruments, Measurement and Optical, and Real Estate and Rental Services. In contrast, sectors with lower growth in production will probably include Private Education, Clothing, Footwear and Leather Products, Lodgings and Food, Tobacco Products, Motor Vehicles, Parts and Equipment, and, finally, c) despite the differences in the growth of the sectors, the Brazilian production structure is not likely to change greatly as the result of changes in the consumption caused by the aging of the population.