Preface and acknowledgements ”Most of us end up with no more than five or six people who remember us. Teachers have thousands of people who remember them for the rest of their lives. ” (Andy Rooney) First of all, I would like to thank my supervisor Prof. dr. Onno W. Steenbeek, who is inspiring, intelligent, honest, and the true embodiment of a mentor. I owe Prof. dr. O. W. Steenbeek a huge debt of gratitude for introducing me to an absolutely new field during the Pension Funds seminar and for his helpful suggestions, unfailing geniality and support before and throughout the research period. Next, I would like to sincerely thank J.A. (Jairo) Rivera Rozo who has provided me with the data on pension funds ’ assets and always found time for a friendly conversation. I really appreciate his welcoming attitude. This work was not completed in a vacuum. I discussed my ideas with fellow students who broadened the value of the work and I am very grateful to Melle Bakker for his insightful comments at the first stage of the research, when I had only a tiny research proposal. I would also like to express my deepest appreciation to my friend Justina Ivanauskaite ̇ for the long discussions about applied econometrics and to Michael Berlemann from Helmut Schmidt Uni-versität Hamburg for confirming that I understand the procedure of capital stock calculation correctly. A very special thanks to Simonas Narušis and my family for their understanding and constant support. Last, but not least I am extremely grateful to all my friends and peo-ple I have had a chance to meet at a healthy lifestyle summer camp in Lithuania. Without them I would not have had an exceptionally good rest in between of the writing process.

irk be ck W or ki ng P ap er s in E co no m ic

The ageing of the world population is an ineluctable process with major economic implications. Whereas there is extensive research on macroeconomic effects and on financial asset prices, there has been more limited systematic research into the impact of demographic changes on financial asset volumes and financial market structure more generally, as driven by age-related household saving and asset allocation decisions. Our empirical work based on the experience of 72 countries, viewed in the light of the existing literature, suggests that demographic changes have had a detectable impact on financial structure. Ageing tends to benefit bond markets relative to equity markets, while depressing private saving and external balances, albeit not sharply reducing the overall size of the financial sector. Continuation of such patterns during the coming period of ageing have wide-ranging implications for policy-makers and market participants. 1.

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