Topic: Living in a Ghost Town: The Geography of Depopulation and Aging

Lecturer: Assistant Professor, Yuta Suzuki, Shanghai Jiao Tong University

Time: 16:00 p.m. October 20th, 2023

Venue: B336 Zhixin Building, Central Campus

Abstract: We study how depopulation and aging progress across regions within a country and how this process affects economic welfare across regions and generations. Using spatially disaggregated data from Japan for the last 40 years, we document that youths’ out-migration accelerated rural depopulation and aging, leading to a decline in rural economic activity. Motivated by this evidence, we develop a dynamic life-cycle spatial equilibrium model of migration decisions. Using the calibrated model, we find that endogenous decline in rural amenities plays a crucial role in the past and future youths' out-migration, and hence accelerates the regional disparity in depopulation and aging. Shutting down cross - regional migration comes at a substantial welfare loss for the youths, while generating limited benefits even for the elderly in rural areas.