The economic benefits of making longer lives as healthy and productive as possible are considerable.

Over the past 20 years, a new term has begun to reframe the way scientists, from epidemiologists to economists, view aging populations. The “longevity dividend” refers to the benefits older adults contribute to society.

The idea has also been a pivot point in some researchers’ own lives. Andrew J. Scott, a professor of economics at the London Business School, used to teach a course called World Economy: Problems and Prospects. One of his lectures was on aging societies, filled, he says, with misery and bad news. Scott applied the then-standard approach to two concurrent demographic trends,  falling birthrates and longer lifespans, and assumed costs for expenses such as pension funds would go up.

But one day, Scott was struck by his own slide showing that people were, on average, living longer. “I stopped and thought, that sounds like good news to me,” he says. “How did we turn this into a bad news story?” In the aftermath of the 2008 financial crisis, Scott began digging into data on aging populations and their economic effects, and found that  when life expectancy increases but is matched by improved health among the aging, it can lengthen purposeful, productive lives, resulting in a “longevity dividend” at an individual, social and economic level. “In the 20th century, we added years to life. In the 21st, we must add life to these extra years,” he and a coauthor wrote last year in an article for the  International Monetary Fund’s Finance & Development magazine. 

The term “longevity dividend” seems to have first appeared in the scientific literature in a 2006 article in The Scientist. The lead author, S. Jay Olshansky, professor of epidemiology and biostatistics at the University of Illinois Chicago, and his colleagues made a two-fold argument. First, they said that medical interventions aimed at slowing aging rather than treating individual diseases had the potential to do what drugs, surgeries and behavior modification couldn’t — extend “youthful vigor and simultaneously postpone all the costly, disabling, and lethal conditions expressed at later ages.”

Secondly, the researchers argued, extending healthspans could have enormous economic benefits: giving people the ability to work for additional years, adding to income and savings, paying taxes and easing pressure on age-based entitlement programs.

As the longevity dividend came to be discussed more widely, it eased concern, in at least some quarters, about the “demographic doom” perspective stemming from another economic calculation: the age dependency ratio, measuring the proportion of working-age adults in relation to those under 15 and over 64.

Scott cites figures from the OECD to assert that at least one aspect of the longevity dividend is already apparent: People are working longer. Ninety percent of the growth in European workers over the last decade, he writes, came from the increase in the number of workers over 50. The proportion is even higher in Japan.

Evidence for how much potential the longevity dividend has comes largely from economic modeling. In 2013, in the health-policy journal Health Affairs, a group of scientists, including Olshansky, used simulations of the future health and spending of older adults in the U.S. and found that a focus on delaying health impacts related to aging — rather than individual diseases — could add 2.2 years of mostly healthy life expectancy and create an estimated $7.1 trillion in value over 50 years. Scott and two colleagues went further in 2021, predicting in a Nature Aging article that a one-year increase in life expectancy in the United States would be worth $38 trillion. 

The longevity dividend is a compelling organizing idea. But whether the projections prove accurate remains to be seen and may depend on how medical interventions — for example, weight-loss drugs — are made available to all who need them, regardless of ability to pay.

David L. Wheeler, a freelance writer based in Clarksburg, Maryland, was awarded a Vannevar Bush Fellowship at MIT for journalists interested in science. He is a former  managing editor of the Chronicle of Higher Education.