Download BERL Presentation

What is wealth?
And how it affects older people
presentation to
Opportunities of Ageing Conference
Dr Ganesh Nana
Chief Economist
Business and Economic Research Ltd
10 April 2013
Opportunities of Ageing Conference – 100413
slide 1
Economics and wealth is all about
liquidity
swap rates
house prices
interest rates
inflation
leverage
debt
hedge funds
ratings
Opportunities of Ageing Conference – 100413
slide 2
Wealth is …
whānau
people
skills &
knowledge
iwi
land
buildings
businesses
networks
experience
innovation
technology
machinery &
equipment
water
liquidity
swap rates
house prices
interest rates
inflation
leverage
debt
hedge funds
ratings
Opportunities of Ageing Conference – 100413
slide 3
… and economics is about …
• how we (choose to) use resources
(wealth) to
* produce things we want, need, desire
* look after, maintain, or replenish resources
* improve and/or expand resources
investment to replace
consumer benefit
investment to grow
Opportunities of Ageing Conference – 100413
slide 4
Our choices in using wealth
consumer
goods and
services
resources
or
wealth
for today
investment to
replace
for
tomorrow
investment to
grow
Opportunities of Ageing Conference – 100413
slide 5
Wealth
individual perspective
• financial
• health and physical
• social participation
• life experiences
Opportunities of Ageing Conference – 100413
slide 6
Wealth accumulation as we age
liquid financial
wealth
age
Opportunities of Ageing Conference – 100413
slide 7
Wealth accumulation as we age
illiquid financial
wealth
age
Opportunities of Ageing Conference – 100413
slide 8
Wealth accumulation as we age
health and physical
wealth
age
Opportunities of Ageing Conference – 100413
slide 9
Wealth accumulation as we age
social participation
wealth
age
Opportunities of Ageing Conference – 100413
slide 10
Wealth accumulation as we age
life experiences
wealth
age
Opportunities of Ageing Conference – 100413
slide 11
Wealth accumulation as we age
liquid financial
health and physical
wealth
wealth
life experiences
wealth
age
age
illiquid financial
wealth
social participation
age
wealth
age
age
Opportunities of Ageing Conference – 100413
slide 12
Drivers of accumulation of
wealth
Opportunities of Ageing Conference – 100413
slide 13
Drivers of wealth
liquid financial
• income
* education opportunities
* employment opportunities
* abilities
• financial literacy
* understanding
* opportunities
• luck
Opportunities of Ageing Conference – 100413
slide 14
Drivers of wealth
illiquid financial
• spending behaviour
• savings habits
* home ownership options
• family circumstances
• financial literacy
* understanding
* opportunities
• luck
Opportunities of Ageing Conference – 100413
slide 15
Drivers of wealth
health and physical
• lifestyle and diet
• family history / circumstances
• housing situation
* living conditions
* physical environment
• income
• luck
Opportunities of Ageing Conference – 100413
slide 16
Drivers of wealth
social participation
• family circumstances
• social situation
* isolated or connected?
• status of wider networks
* schools
* business
* community
• income
• luck
Opportunities of Ageing Conference – 100413
slide 17
Drivers of wealth
life experiences
• family
• networks
* schools, business, community
• passion and/or opportunity to explore
• income
• luck
Opportunities of Ageing Conference – 100413
slide 18
Drivers of wealth
... and, finally ...
• endowments
* whakapapa
* status or history
* knowledge or understanding
* financial
Opportunities of Ageing Conference – 100413
slide 19
Or, is wealth …
• collective
* family
* whānau
* iwi
• nation
Opportunities of Ageing Conference – 100413
slide 20
Business investment
16
as % of GDP
%
14
12
10
8
6
Dec 88
Dec 94
Dec 00
Dec 06
Dec 12
Opportunities of Ageing Conference – 100413
slide 28
Government investment
10
as % of GDP
%
8
6
4
2
0
Dec 88
Dec 94
Dec 00
Dec 06
Dec 12
Opportunities of Ageing Conference – 100413
slide 29
Labour force participation rate
70
%
68
66
64
62
Dec 88
Dec 94
Dec 00
Dec 06
Dec 12
Opportunities of Ageing Conference – 100413
slide 30
Labour force participation rate – 60-65yos
75
%
65
55
45
35
25
Dec 88
Dec 94
Dec 00
Dec 06
Dec 12
Opportunities of Ageing Conference – 100413
slide 31
Labour force participation rate – 65+yos
24
%
18
12
6
0
Dec 88
Dec 94
Dec 00
Dec 06
Dec 12
Opportunities of Ageing Conference – 100413
slide 32
Govt education expenditure
as % of GDP
8
%
6
4
2
1996
2000
2004
2008
2012
Opportunities of Ageing Conference – 100413
slide 33
Opportunities of ageing
• to contribute to accumulation of wealth
across all dimensions
* life experiences
* social participation
* health and physical
* financial
* and collective
• and so to improve (increase) resources
available for nation to make its choices
Opportunities of Ageing Conference – 100413
slide 34
NZ 2012 population
females
90+
85–89
80–84
75–79
70–74
65–69
60–64
55–59
50–54
45–49
40–44
35–39
30–34
25–29
20–24
15–19
10–14
5–9
Under 5
18
31
males
8
19
47
58
37
50
79
72
97
92
121
134
156
163
164
148
143
149
159
152
142
141
152
200
150
116
128
147
152
149
135
134
149
171
161
148
148
161
100
50
0
50
100
150
man
drought
but the
next 25
yrs ???
200 000s
Opportunities of Ageing Conference – 100413
slide 35