Age Structure and Inflation Dynamics in Pacific Island Economies
Abstract
This study uses the panel of six Pacific Island Countries (PICs) to investigate the relationship between changing age structures and inflation. The findings suggest that both aggregated and disaggregated shares of the working-age population exert disinflationary pressure. This supports the life cycle hypothesis, which postulates that people in their productive years tend to save and produce more than they consume, fostering economic stability and managing inflation. Conversely, the findings indicate that old-age dependency contributes to inflationary pressures. These insights underscore the importance of demographic dynamics in shaping inflation trends and provide valuable guidance for policymakers aiming to maintain price stability.
Fields of Study & Subjects
Financial Literacy
Pension
Retirement Analysis
New Zealand Economic and Social Studies
Island Studies and Pacific Affairs
Publication details
- Journal / source
- Bulletin of Monetary Economics and Banking
- Publisher
- Bank Indonesia, Central Banking Research Department - Digital Commons
- Volume
- 29
- Issue
- 1
- Pages
- 1–20
- Publication date
- 9 February 2026
- Language
- EN