Silver dividends: How investing in ageing societies can boost growth and cut healthcare costs

As countries age and people work for longer, their presence and engagement are felt across the economy. For governments, this could be another source of growth. For this, ageing societies will have to be rebuilt around the elderly. This would require significant investments in physical infrastructure and human capital. Done well, that investment will raise output and hold down healthcare costs at the same time. We call this the silver multiplier investments whose returns cascade across the economy and are captured in many places at once.

Longevity investment currently focuses on biology rather than infrastructure. Investors are piling funding in drug discovery, cellular reprogramming and rejuvenation and even pet longevity. These, while useful, fail to factor in other determinants of living longer.

Ageing societies can put pressure on all the components of economic growth because of increased state spending, healthcare costs, loss of human capital and expertise and possible decline in productivity. However, keeping workers engaged for longer, by providing an enabling infrastructure to allow them to thrive in a society, can have a positive impact.


The silver multiplier follows a logic similar to the Keynesian multiplier, which posits that an initial investment in the economy, say through government spending, can stimulate a prolonged growth, resulting in a cycle of increased income and consumption. In the case of the silver multiplier, people should be enabled to work longer by raising the age of retirement and investing in urban infrastructure that allows the elderly to commute with ease.

Research shows that in US, retirement of a healthy American costs roughly $230,000 in annual GDP. The fiscal benefits are quite significant since an estimated $25,600 is also needed to finance retirement-related transfers for each retiree.

Keeping older people engaged can generate immense public health benefits. The state must play a proactive role in shaping the future of ageing societies.

WHO Commission on Social Connection, 2025, found that loneliness was linked to 871,000 deaths annually and a heightened risk of stroke, heart disease, diabetes and cognitive decline. Social connections, its report said, resulted in improved health and reduced the risk of early deaths. The cost of social isolation is high: a 2017 study found that in US, Medicare spent on an average $1,608 more a year for each older person with limited social connections than for those who are more socially active. This translated into an estimated $6.7 billion in added Medicare spending each year.

Older people working for longer does not necessarily crowd out younger workers. Those aged 55-64 are the largest set of entrepreneurs and are likely to have the social and financial capital to set up new businesses and, in turn, grow the economy and still remain engaged. This is why the

Finland had a national programme on ageing workers, which ran from 1998 to 2002. This resulted in the employment rate of older age groups being higher in Finland than the EU average.

Approximately 300,000 new jobs were created in Finland between 1999 and 2001, with nearly three-fourths of these jobs benefitting those over the age of 55.

Meanwhile, the Japanese town of Kamikatsu has the lowest per capita elderly medical costs in Tokushima prefecture, despite having the highest rate of ageing and that is because of a new business that employs locals as farmers. The village has only 1,415 residents and is unlikely to shape the macroeconomic outlook for the country; however, it provides a micro perspective on what states could do to unlock the silver multiplier.

Silver infrastructure attracts almost no capital now, because their returns are scattered across the economy and no single balance sheet records them. That is why the state must anchor investments in longevity infrastructure. One important measure is classification. In some countries, fiscal rules treat capital spending as investment to be protected and current spending as a cost. Spending that keeps older people engaged, from mid-career reskilling to flexible work programmes and accessible transport, is an investment, rather than current spending alone.

The present excitement around longevity rests on individual changes to lifestyle and drugs. However, ageing societies need much more than that. Rebuilding them around older citizens unlocks fiscal, health and social returns that land across the economy. Until governments can quantify these returns, the silver multiplier will remain a mirage, despite its immense value.

Sagar is CEO of age-tech platform WisdomCircle and Martwala is its policy advisor. (Views are personal)