the retirement age to 64 for both men and women has a significant impact on the demographic dividend possibly because the share of population ages 60-64 for men and 55-64 for women is fairly large.

**Table 5: Demographic Dividend with Higher Retirement Age**

|Simulation of dem|ograpfic div<br>Sc|idend bas<br>enario 1(l|ed asuumt<br>ow fertilit|ion ofgradu<br> y)|al increase<br>S|of retirme<br>cenario 2|nt age and<br> (baseline)|officialpop|Sc<br>ulation bya|enario 2(<br> gegroup|high fertili<br>s forecast|ty)|
|---|---|---|---|---|---|---|---|---|---|---|---|---|
||2012‐16|2017‐21|2022‐30|2012‐30|2012‐16|2017‐21|2022‐30|2012‐30|2012‐16|2017‐21|2022‐30|2012‐30|
|Russian Federation|‐0.2|1.0|1.8|1.0|‐0.5|0.5|1.2|0.6|‐0.6|0.3|0.9|0.3|
|Central Federal Okrug|‐0.2|1.1|1.8|1.0|‐0.5|0.6|1.2|0.6|‐0.6|0.4|1.0|0.4|
|North‐Western Federal Okrug|‐0.2|1.2|2.0|1.2|‐0.5|0.7|1.4|0.7|‐0.6|0.5|1.2|0.6|
|Southern Federal Okrug|‐0.1|1.1|1.9|1.1|‐0.4|0.7|1.3|0.7|‐0.5|0.4|1.0|0.4|
|North‐Caucas Federal Okrug|0.0|0.6|1.0|0.7|‐0.2|0.1|0.4|0.2|‐0.5|‐0.5|‐0.1|‐0.3|
|Volga Federal Okrug|‐0.2|1.0|1.7|1.0|‐0.4|0.5|1.2|0.6|‐0.6|0.2|0.8|0.3|
|Ural Federal Okrug|‐0.3|1.0|1.9|1.1|‐0.6|0.5|1.3|0.6|‐0.7|0.3|1.0|0.4|
|Siberia Federal Okrug|‐0.4|0.9|1.8|1.0|‐0.6|0.5|1.2|0.5|‐0.8|0.2|0.9|0.3|
|Far East Federal Okrug|‐0.3|1.2|2.0|1.2|‐0.5|0.7|1.4|0.7|‐0.7|0.4|1.1|0.5|
|10 Leaders|‐0.1|1.0|1.7|1.1|‐0.3|0.6|1.2|0.6|‐0.5|0.3|0.8|0.3|
|10 Laggards|‐0.3|1.0|1.8|1.1|‐0.5|0.5|1.3|0.6|‐0.6|0.3|1.0|0.4|
|Rich|‐0.2|1.2|2.0|1.2|‐0.5|0.7|1.4|0.7|‐0.6|0.4|1.1|0.5|
|Poor|‐0.2|1.0|1.7|1.0|‐0.4|0.5|1.1|0.6|‐0.6|0.2|0.8|0.3|

# **Section IV. Conclusions**

Absent policy changes, the aging of the Russian population is likely to have an adverse impact on growth and convergence. Russia's economy benefited from favorable demographic trends from the mid-1990s until the last few years. In the coming decades, however, Russia’s population is expected to age, which could dampen prospects for growth and convergence among Russia’s regions. This challenge underlines the importance of wide-ranging policy changes to help families, workers, and businesses to adjust to population aging. The paper discusses one crucial reform, the increase in the official retirement age. This policy would need to be complemented by measures to ensure that this translates into a rise of the effective retirement age. Other policies include, among others, the following: increased investment in preventative care to improve health status and thus enable people to work longer; lifelong learning programs and other steps to refresh the skills of an aging workforce; taking legal measures against age discrimination and reducing other constraints on mobility (e.g. making pensions portable); and the provision of quality day care and long term care to facilitate greater labor force participation (which would particularly benefit women, who provide the bulk of such care). By contrast, simply focusing on increasing fertility rates will only address the aging challenge partially. Without supporting policies, mothers might drop out of the labor market to take care of their children, which would further reduce the number of workers. All of these efforts would not only bolster growth and convergence, but also make social security systems more sustainable.

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