Economic Dimension of Aging of the Population on the Example of the Czech Republic

Abstract

The paper, elaborated by an interdisciplinary approach of social sciences (especially economics, sociology, demography and economic policy theories), is focused on the current interconnection of demographic issues of the Czech Republic with social policy at the regional level. The application of methods of analysis, comparison and synthesis evaluates the impacts of population aging in the dimensions of the social system (pensions, social services) and health care. These dimensions are an expression of intergenerational solidarity and an integral part of the state's public finances. As a result of the aging population, Czech public finances are not sustainable despite the expected growth of the economy and tax revenues. Provided current fiscal policy is maintained, public debt would rise to 230% of gross domestic product in 2068. This forecast is also confirmed by the application of generational accounting methods through an intergenerational index, which, based on current economic and social policy trends, foresees a long-term imbalance in public finances within the social and health system of the Czech Republic.