EconPol Forum Opinions Policy Briefs

Just as the widespread wildfires in Spain and France were beginning to subside, the sudden migrant crisis in Ceuta sparked reactions from European governments and institutions. The resulting dispute over asylum has not only put a strain on the fragile European solidarity based on the Dublin Agreement, but it has also created a rift within the Schengen Area. On top of that, it has added further uncertainty in a period when uncertainty is already rampant, as a recent Policy Brief underlines – especially due to the ever-changing geopolitical landscape in the Middle East and the risks attached to it. Accused by some of creating an incentive for illegal immigration with its recent mass regularization program, the Spanish government stated that the program will support the economy, welfare, and pensions. Although the events in Ceuta remind us that migration requires careful governance, legalization pathways are undoubtedly part of the solution to the challenges posed by an aging population, as Madrid has argued. The latest issue of EconPol Forum discusses ways to address these challenges, while a new Opinion presents approaches to countering the sharp rise in public debt across G7 economies. Enjoy the read!

EconPol Forum 03/2026: Dealing with Demographics – The Policy Challenges of an Aging Europe Europe’s population keeps getting older. According to a recent report published by the European Commission, by 2050 the share of the European population aged 65 or older will be around 30 percent, compared with the current 20 percent. While this reflects improving living standards, with life expectancy estimated to be steadily rising, this trend – combined with declining birth rates – poses several challenges for policymakers. How can we ensure the sustainability of public finances in the face of a shrinking workforce and declining pension contributions, coupled with a steady increase in pension expenditures? At the same time, how can we prevent a higher retirement age from disproportionately affecting more vulnerable groups, and women in particular? Part of the Policy Debate in this Forum issue revolves around this apparent dilemma. The remainder explores how the preferences of an aging society shift with regard to domestic and foreign policy (and politics), and what this means for democracy and global peace.

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Policy Debate of the Hour Rethinking Pension Reform for Aging Societies: An Evidence-Based Approach Who Cares? Population Aging and the Gender Cost of Caring for the Elderly Working Longer, Poorer Health? Health Inequality and the Distributional Effects of Raising the Retirement Age When Grandmothers Work Longer: Pension Reform, Family Labor Supply, and Grandchildren’s Outcomes Are Long-Term Care Needs Assessments Fiscal Policy Tools? Age, Longevity, and the Future of Aging Societies Aging Europe and the Politics of Who Votes Population Aging and Preferences for Peace

→ Demographic change and strategies to address it will be the focus of the 2026 EconPol Annual Conference, to be held on November 9 at the Representation of the Free State of Bavaria to the EU in Brussels. Among the speakers already confirmed are:

Prof. Clemens Fuest, President of the ifo Institute; Dr. Horst J. Kayser, CEO Factory Automation at Siemens; Stefan Olsson, Deputy Director-General in DG Employment, Social Affairs and Inclusion at the European Commission; and Prof. Helmut Rainer, Director of the ifo Center for Labor and Demographic Economics at the ifo Institute.

Registration will open shortly. For more details, program updates and speaker announcements, please visit our conference website.

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Economic Policy and its Impact The Welfare Case for Targeting Young Adults: Lessons from France on Age-Based Social Assistance In recent years, the standard of living among young adults has fallen. However, welfare systems continue to focus on the elderly. This study argues that some intergenerational redistribution would benefit not only the young, but also society as a whole.

Institutions Across the World Online Peer Support for Unemployed Job Seekers: Evidence from a Randomized Field Experiment Sometimes, all it takes is advice from a friend – or an expert. This seems to apply very well to the job market. Help from former job seekers improves the job prospects of current seekers. Something to keep in mind when designing employment assistance programs.

Big Data-Based Economic Insights Building in Harm’s Way: Insurance Pricing, Housing Supply, and Wildfire Risk in San Diego The risk of wildfires is growing, and not only in Europe. This makes home insurance increasingly important, as premiums can signal high-risk areas and steer housing demand. However, this only works if there are enough affordable, safer places to move to.

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Lisandra Flach: Mapping Europe’s Trade Exposure to Critical Maritime Chokepoints Since the outbreak of the Iran conflict, the Strait of Hormuz has dominated the news. Although less than 1 percent of German and EU imports pass through it, dependencies vary widely by product. Products such as oil, gas, and some raw materials are highly reliant on this strait. In contrast, roughly some 10 percent of German imports pass through the Red Sea chokepoints – the Suez Canal and Bab al-Mandab Strait – which currently also serve as a bypass for Saudi oil and LNG. The recently renewed Houthi attacks could therefore have severe consequences.

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Clemens Fuest: Risky Public Debt – A Policy Shift Is Urgently Needed By 2025, the average debt-to-GDP ratio in G7 countries had hit a staggering 123 percent mark. As recently as 2000, that ratio was 74 percent. For EU countries – especially high-indebted ones, like France and Italy, but also those with rapidly growing debt, like Germany – managing the growing “fiscal squeeze” (that is, the strain of interest repayments on public budgets) resulting from the debt burden has become imperative. How? Primarily, through growth-oriented measures and long-term public spending consolidation programs.

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Policy Brief 86: Drivers, Costs, and Coping – An Expert View on Economic Uncertainty Economic uncertainty has emerged as a defining feature of our time amid spreading conflicts, erratic trade policies, and disruptive technological change. Drawing on the quarterly Economic Experts Survey, the authors of this Policy Brief have adopted an innovative approach to measuring uncertainty. Instead of measuring it indirectly – for example, based on stock market volatility – they asked global economic experts to assess and quantify the current level of uncertainty in their respective countries on a scale from 0 to 100. Spoiler alert – or probably not: uncertainty is high and real. On average, experts rate the current level of economic uncertainty in their country as 60.7 and estimate that it lowers GDP growth by 0.8 percentage points.

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