Saving a World that Doesn't Save

Around the world, social security and health care are today's hottest economic issues due to the rising dependency ratio : the proportion of elderly people relative to younger, economically active, workers. According to the Population Resource Center, this ratio will double in the world's more developed regions and triple in less developed regions by 2050. With so many more old people in coming decades, governments will be hard pressed to raise enough money to pay for their needs by taxing the young.

None of this is news. But that is the point: despite the vast attention currently paid to the looming old-age crisis, household saving rates have been falling in most of the world's rich countries.

Why aren't people saving more for their future retirement? Why are they actually doing the opposite by saving less ?

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