An Analysis of Age Dependency Burden and Saving Rates in Pakistan

Abstract

This study analyzes the impact of age dependency on gross savings for the period of 1975 to 2018 by applying ARDL and Granger causality techniques. The findings of the study suggest that young-age dependency and old-age dependency have a negative impact on gross savings in the long run. Granger causality test reveals that the causality between age-dependency of young and gross savings is bidirectional while the causality between age-dependency of old and gross savings is unidirectional. The study is also equipped with policy implications.