Countries like Singapore with ageing populations might want to consider formulating immigration policy with a view to attracting young entrepreneurs, a prominent American economist said yesterday.
Stanford University economist Edward Lazear said his research shows that rapidly ageing countries tend to have lower rates of entrepreneurship, which in turn could hit economic growth.
Prof Lazear, who spoke about his research at the Singapore Economic Review Conference yesterday, said this is not only because young people tend to be more creative and energetic, but is also due to the fact that when most key roles are occupied by older people, young people do not get the chance to acquire skills needed to start businesses.
“Human capital is important in entrepreneurship… It’s not just about creativity or energy, you also need the opportunity to acquire skills necessary to start a business,” said the professor, who was chief economic adviser to President George W. Bush from 2006 to 2009.
This is particularly an issue in China, where the one-child policy has led to an ageing society, he added.
While Singapore is facing the same challenges as many advanced countries with ageing populations, it is still in “good shape” and remains a “dynamic society”, Prof Lazear noted.
Singapore is ageing but not as quickly as the typical advanced OECD (Organisation for Economic Cooperation and Development) country, he said. The rate of entrepreneurship here is also slightly higher compared with those countries.
“(Some policy issues arising from this revolve around) altering immigration policy so as to encourage entrepreneurial young people to come to your country,” Prof Lazear said in an interview with local media yesterday.
Chia Yan Min