The slow growth the U.S. economy has experienced since the recent recession is not a fleeting condition, rather it’s the result with a serious demographic problem that is poised to dampen economic growth for years, according to a recent research paper by three Federal Reserve economists.
The economists’ model-based data analysis “suggests that demographic factors offer an explanation for puzzlingly weak business investment in the wake of the Great Recession, which some authors … have instead traced back to persistent uncertainty and limited investment decisions,” Etienne Gagnon, Benjamin Johannsen and David Lopez-Salido write in a working paper dated Oct. 3.
