account two fundamental constraints. one is the ageing of the population. according to the stability programme update 2018, the size of the 65 - plus cohort is set to nearly double between 2016 and 2040 ( from 629 thousand to 1. 21 million ), with a corresponding increase in the old - age dependency ratio from 20. 9 to 37. 1. the ageing of the population has implications for the aggregate growth rate of the economy, in addition to posing challenges for public and private pensions, the provision of long - term care, the healthcare system and the education system. the other is the imperative for the world to make the transition to a low - carbon economy, requiring the contraction of carbon - intensive activities and the expansion of environmentally - sustainable activities. with sufficiently - early action, the costs of this transition may be quite limited, whereas a delayed transition would increase adjustment costs and run the risk of failing to cap the increase in global temperatures within an acceptable range ( european systemic risk board 2016 ). accordingly, the debate about long - term priorities should focus on the optimal mix of developmental policies to deliver sustainable growth, while recognising the financial constraints imposed by the legacy of high public and private debt levels and the imperative of managing the implications of an ageing population and a successful transition to a low - carbon global economy. central bank of ireland - unrestricted figure 3. national income : 1995 - 2017. 300, 000 euro millions, nominal 250, 000 200, 000 150, 000 100, 000 50, 000 - gdp gni gni * note : gni * adjusts gross national income to strip out the depreciation of foreign - owned intellectual property assets. data from central statistics office. figure 4. household disposable income 60, 000 us dollars, per capita, gross 50, 000 40, 000 30, 000 26, 400 20, 000 10, 000 lva grc pol est svk svn cze prt kor esp irl ita eu uk ea nld dnk jpn fin can swe bel fra aut aus deu nor che lux usa source : oecd central bank of ireland - unrestricted note : oecd ( 2018 ), household disposable income ( indicator ). doi : 10. 1787 / dd50eddd - en ( accessed on 20 july 2018 ). i will not attempt to offer a comprehensive analysis of these issues. let me make three points. first,

; the 1980s fiscal crisis ; and the most recent crisis that ignited in 2008 ( o ’ grada 2011 ). furthermore, the vast international literature on economic and financial crises has identified many cases, with the causes and consequences of these episodes much debated ( kelly 2007, reinhart and rogoff 2009, laeven and valencia 2013 ). a primary lesson from the literature is that crises can emerge for many reasons. while some busts indeed follow boom phases, it is also possible to experience a negative shock that pushes a normally - functioning economy into crisis conditions within a short time period. in addition, not all booms are followed by busts – the infamous “ soft landing ” scenario sometimes plays out. from a policy perspective, it is clearly important to reduce vulnerability to crises by refraining from adverse macro - financial patterns such as persistently - excessive credit growth or unsustainable fiscal imbalances. in addition, especially since crises can arise even if domestic credit and fiscal conditions are in reasonable shape, it is also important to ensure the macro - financial system is resilient even in the event of severe external shocks. central bank of ireland - unrestricted currently, the international risk factors that are at the top of our monitoring list include : ( i ) the risk of an unexpectedly - sharp tightening in international financial conditions, as might be triggered by an increase in risk aversion among investors ; ( ii ) a downgrading of future global growth prospects, with an international trade war one possibly catalyst ; ( iii ) a shift in global tax practices that adversely affects small countries that host global multinational firms ; and ( iv ) hard brexit scenarios. while the first two risk factors are common across all economies, ireland is especially exposed to the second pair of risk factors. while it is tricky to attach a probability to any of these scenarios, the potential adverse impact on the irish economy and irish financial conditions calls for the accumulation of financial and fiscal buffers that would help to limit the damage. in relation to financial - sector buffers, the central bank is working to ensure that the capital positions of banks are sufficiently strong to withstand the losses that could be triggered by a negative shock. our policy interventions include the recent activation of the counter - cyclical capital buffer : in the event of a downturn, this capital buffer can be released, thereby avoiding a pro - cyclical withdrawal of credit supply under adverse conditions. i in relation to new mortgage lending, our borrower - based