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If a country has a large working-age share but a very low labor-force participation rate, which limitation of age structure becomes clear?

Answer and explanation

Correct answer: A favorable age structure does not automatically produce economic gains

The governing concept is the demographic dividend. A large working-age share creates a potential advantage because more people could produce goods, earn income, and support dependents. It does not guarantee those outcomes. When labor-force participation is very low, many working-age people are outside employment or active job seeking, so the potential labor supply is not converted into actual production, tax revenue, or household income. Education, health, skills, gender access, suitable jobs, and institutions also influence the result. Option A is too absolute, option C is not necessarily true, and option D wrongly denies the relevance of age structure. Therefore, B is correct.

Related tags

Demographic DividendLabour-Force ParticipationWorking-Age PopulationEconomic DevelopmentAge StructurePopulation CompositionGeographyClass 12 Mcq

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