Introduction

At different points in the life course families and individuals differ in both their needs and in terms of the resources they can command. Large shares of children require large expenditure on education and family resources. Large shares of young adults put the labour and housing markets under strain. In a stable population that would not make much of a difference to public policy since the relative shares of different age groups in that special case remain the same. But modern populations are far from stable. The demographic transition from high mortality and high fertility to a state of low mortality and low fertility results in a secular change where the initial population pyramids undergo what demographers call a ‘rectangularisation’.

To begin with this is a highly beneficial change where an economy increases its economically active population in relation to the dependants. This demographic gift can be tracked in the old European welfare states as well as in the emerging economies of Asia. This gives ample room for social reform and in most countries, especially in Europe, the public sector has taken over more and more responsibility for intergenerational transfers of many different kinds: public pension schemes, public care systems, education and a variety of family support systems.

As the structure of the population changes these public commitments often come under strain or, more rarely, tend to become overly generous. In any case the slow inertial change of the population structure, not only with respect to age, but also in ethnic composition, and even, in some Asian countries, in gender composition, creates new challenges to public policy in terms of financing as well as in terms of new needs arising from the demographic change.

In Europe fast ageing populations are now emerging and worry public policy makers as tax bases are projected to shrink and demands for decent care and a worthy life for elderly people become harder and harder to fulfil. At least that is the picture we have got used to from media and politicians eager to save for this bleak future. Change and adaptation will indeed become necessary as the composition of the population changes its point of gravity towards ever older ages.