Advanced population ageing and social expenditure – some evidence from long-run relationships in OECD countries

The study investigates the long-run relationship between social expenditure and advanced population ageing in 36 OECD economies from 1999 to 2022. To analyze long-run relationships, the study applies panel cointegration, common correlated effects mean group (CCEMG) estimator, augmented mean group (AMG) estimator, group-mean fully modified ordinary least squares (FMOLS) and dynamic ordinary least squares (DOLS) methods to compare the estimation results. The share of the population aged 80 and over in the total population is used as an indicator of advanced ageing. The results indicate that the effects of population ageing are not robust in the full sample. Findings from alternative specifications suggest that this relationship is not observed across the entire sample. The study also finds that technological progress may be an important determinant of the social expenditure-to-GDP ratio. The results offer insights for policymakers in demographically changing economies, emphasizing the need for reforms of welfare programs, increasing technological progress to support the long-term sustainability of public finances. First published online 11 November 2026