WP-04 Dynamic Demographics and Economic Growth in Vietnam
Nguyen Thi Minh
Abstract
This paper is an empirical study into the effect of the age-structure of the population on economic growth in
Vietnam. The statistics show that in recent years,
Vietnam’s
demographics have been changing remarkably with an increase in the
labor force as well as a decrease in the dependency ratio. This change
offers a great opportunity for the economy to enhance its economic
growth in the short and medium terms at least. Our estimated results
from regression models also indicate that
Vietnam
has utilized this opportunity: the change in demographics has
contributed up to 15 percent of economic growth during the last five
years. Secondly, while being categorized as dependent,
the elderly do not seem to have a negative impact on economic growth, however young children do.
Vietnam’s
population demographic will probably shift from a favorable spread of young people to an aging population in about ten years. Therefore, it is very important
for the Vietnamese government to take advantage of this dividend period in
order to improve human capital and technology, in addition to preparing for a coming
period of demographic debt. In addition, building up sound pension and
health care systems in the medium term is also crucial.
Working papers 
