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In economics, geography, demography and Sociology the dependency ratio theory is an age-population ratio of those typically not in the labor force (the dependent part ages 0 to 14 and 65+) and those typically in the labor force (the productive part ages 15 to 64). It is used to measure the pressure on productive population.

Dependency ratio is essential for all countries. It is one element that benefits the economy in growing during residents elderly age. It is recommended to have a moderate but stable ratio that helps the country prosper. In the article, “Minimizing the Dependency Ration in a Population with Below-Replacement Fertility Through Immigration ”, having an intermediate dependency ratio informs us that there are sufficient people in the working class who can support the dependent population. In return would provide better pensions and health care for residents. As a result, increasing fertility and allowing more immigration offers improvement on the economy. Immigration plays a major role on the economy. Several individuals who migrate are the young working class who contribute to the workforce. Migration also benefits countries that are below the fertility replacement level .Which is the reproduction level of population that replaces itself from one generation to another. Therefore, having working age immigrants help increase the number of people who can sustain the dependent groups.