Sectoral Impacts of International Labour Migration and Population Ageing in the Czech Republic

This study assesses macroeconomic and sectoral impacts of demographic changes in the Czech Republic as a result population ageing international migration. To do so, it develops unique dynamic Overlapping Generations Computable General Equilibrium (OLG–CGE) model with detailed representation individuals different ages, educational attainment occupations, well interrelations among industrial sectors producing intermediate final outputs. The numerical simulations show that economy will face substantial reduction its effective labour supply aggregate demand patterns, leading to lower economic growth (4.4% GDP by 2050 absence technological progress), increase unit costs (5.2% higher wages inflation) competitiveness whole. Replacement migration may alleviate pressure, yet current gross immigration would need at least 8-17 thousand per year compared UN projections (a 15–34% increase) without changing emigration patterns order offset adverse long-term effects.