The pace of convergence of population aging in Latin America: Opportunities and threats

Gilbert Brenes-Camacho, Universidad de Costa Rica

Some of the fastest demographic transitions in the world have been observed in Latin American countries. Fertility and mortality declines have occurred in less than half the time observed in industrialized countries. Population aging is also occurring rapidly in the region. However, its socioeconomic consequences take longer to happen. Socioeconomic disadvantages experienced by current cohorts of Latin American elderly are more difficult to change over time because of the persistence of cohort effects. The slower pace of population aging with respect to other demographic dynamics translates into both opportunities and threats. This paper intends to describe the differences in the population aging process across Latin American countries, and how these differences can show the path for institutional changes that can improve the welfare of Latin American nations. The paper will first explore how advanced are different Latin American countries in their population aging process. The paper will link this information with data about Social Security coverage among the labor force, labor force formalization, and availability of caretakers. The article concludes highlighting the need of serious reforms in terms of Social Security coverage, not only pension reform, for securing the well-being of Latin American elderly in the near future.