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Pré-Publication, Document De Travail Année : 2019

Demographics in MENA countries: a major driver for economic growth

Résumé

MENA region is undergoing rapid demographic transition, where 50% of the population is under the age 25 and high youth unemployment rates are argued to be one of the main sources of political instability. Fighting youth ex- clusion from work is one of the main challenges in the region. In this paper we evaluate the economic impact of the demographic transition for selected coun- tries which experience di_erent speeds of transition, namely: Iran, Morocco and Egypt. The impact of demographic shift on the evolution of human capital stock and physical capital stock, has been highlighted by the literature. Since _nan- cial markets play a crucial role to allocate capital and channel the funds to the productive sector, it is hence fundamental to take into account the role of the _nancial markets in the growth process associated with demographic change. We have developed a general equilibrium overlapping generations model with a cost for capital mobilisation as a proxy for _nancial markets' e_ciency. We have found that the demographic shift will be an important driver for growth in the upcoming decades. Furthermore, our results show that a more e_cient _nancial sector leads to better economic performance. Speci_cally, youth are the primary bene_ciaries: an increase in the _nancial sector e_ciency can reduce up to 8 percentage points of the youngest age group unemployment.
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Dates et versions

halshs-02409029 , version 1 (13-12-2019)

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  • HAL Id : halshs-02409029 , version 1

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Yeganeh Forouheshfar, Najat El Mekkaoui, Hippolyte d'Albis. Demographics in MENA countries: a major driver for economic growth. 2019. ⟨halshs-02409029⟩
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