What is a dependency ratio and why does it matter for social policy?

• A. The ratio of births to deaths.
• B. The ratio of dependents (young and old) to working-age people.
• C. The ratio of immigrants to natives.
• D. The ratio of men to women.

Answer: (C)

The key idea is to look at how many people depend on the working-age population for support. The dependency ratio compares dependents—usually young people under 15 and older people 65 and over—to those in the working-age group (15–64). It’s often shown as the number of dependents per 100 workers.

Why this matters for social policy is that dependents rely on public services and the labor force to fund things like education, healthcare, and retirement benefits. When the share of dependents is high relative to workers, there’s more demand for services per worker and potentially higher fiscal pressure on government budgets and families. This helps policymakers decide on issues like retirement age, pension levels, childcare and eldercare support, and whether immigration or incentives to boost labor participation are needed to maintain economic and social stability. In aging populations with lower birth rates, the ratio tends to rise, signaling a greater need to adapt policies to sustain public services and economic growth.