In Europe's Coming Demographic Challenge: Unlocking the Value of Health (AEI Press, November 2007), Nicholas Eberstadt and Hans Groth assess the ways that Western Europe's rapidly aging and shrinking population affects economic growth. They argue that Europeans can address economic challenges by making fundamental lifestyle changes.

As Western Europe's working-age population shrinks, the region will find it difficult to improve or even maintain its pace of economic growth. Many options to arrest demographic changes are of limited use: expensive pro-natalist policies are largely ineffective, and Europe is unlikely to assimilate more immigrants. But Europe has one strong competitive advantage: positive trends in mortality and health.

As Europe ages, it is enjoying substantial improvements in life expectancy and elderly health. Older workers are often more educated, and thanks to a largely knowledge-based economy, there are fewer physical limitations on the work they can do. Eberstadt and Groth focus on how good health can enhance the productivity of those between fifty and seventy--Europe's best prospect for an increased labor supply. The "European health and mortality profile is a tremendous blessing and a potentially powerful economic springboard," they write. Yet Europeans of these ages tend to shun work: "Never in history have older Europeans been so healthy, yet never, in all likelihood, have they worked so little."

Eberstadt and Groth offer a policy framework for promoting old-age work: more flexible labor markets, widely available education and vocational training, and continuing investment in health technology innovation. They conclude that "relative economic decline is by no means inevitable for Europe or its people"--but the hard choices and lifestyle changes necessary to prevent decline now rest with Europeans themselves.

For more information about this book, visit www.aei.org/book914/.