Amit's Blog

Navigating the Straits: Turkey's Economic Journey and Strategic Ambitions Turkey's economy is currently undergoing a crucial period of transition, moving towards more orthodox macroeconomic policies to tackle its long-standing challenges of high inflation and currency volatility. After a turbulent two decades marked by both impressive growth spurts and recurring crises, the current government has embarked on a stabilization program featuring aggressive interest rate hikes and fiscal tightening. While this shift is showing early signs of success in bringing down inflation and narrowing the current account deficit, it comes at the cost of slower GDP growth in the near term. Beyond these immediate economic adjustments, Turkey faces the long-term structural challenges of an aging population, productivity concerns, and a persistent reliance on external financing. Simultaneously, its burgeoning defense industry is emerging as a significant pathway for both economic diversification ...

  Part 3 – Greying and aging before it gets rich   In the 3 rd part of this series, we take a look at China. China has been the most dynamic economy on the world stage during the last 40 years. It is now the second-largest economy in the world and has largely been the growth engine for the rest of the world. During these years it has also pulled more than 500 million people out of abject poverty, a feat unparalleled in the history of the world. China has been a very strong economic performer and is set to overtake The United States during this decade. However, it is still a middle-income country with an annual per capita income of around USD 12,500. This is about 1/4 th the level of any of the developed economies. Aging is coming relatively early to China and the consequences cannot be pretty. China has a certain similarity with Japan, in the sense that it hasn’t seen large scale immigration. However, its internal distortions have been incredibly big. First, there wa...

  Part 2 – What has been the Japanese Experience   In this, the second part of the series, we take a look at Japan. Japan was one of the dominant economies of the last century (it still is the 3 rd largest economy in the world) and has consistently enjoyed high levels of per capita income. However, during the last 30 years, the economy has hardly grown while it has rapidly aged. At the beginning (not too long ago; just about 150 years ago) most countries had high birth and high death rates resulting in slow population and low economic growth.   Countries that had industrialized rapidly had started growing faster (though some may argue that colonialization played a part too). There is no doubt that industrial society harnessed labour and capital more effectively than a purely agrarian society could. After some time, economic growth results in better public health and a decrease in death rates, thereby stimulating population growth and, with a lag, faster economic ...

  Part 1 – The key parameters that influence shifts Economic demography examines the determinants and consequences of demographic change, including fertility, mortality, marriage, divorce, location (urbanization, migration, density), age, gender, ethnicity, population size and population growth. Demographic dividend refers to the growth in an economy that is the result of a change in the age structure of a country's population. The change in age structure is typically brought on by a decline in fertility and mortality rates. Demographic dividend occurs when the proportion of working people in the total population is high because this indicates that more people have the potential to be productive and contribute to growth of the economy. In essence, there’s a period in nation’s progress when longevity is increasing and working age population is large in proportion to the old age population. The median age is low. This is when the nation is best positioned to move forward. In th...