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By John Rennie Short, University of Maryland, Baltimore County 

Government-shaking protests in Bangladesh, Iran, Nepal and Sri Lanka – to name a few – have all in recent years been linked to what demographers call a “youth bulge.” Meanwhile, the economic slowdown in China and ballooning public debt in the United States are in part due to the two powers’ aging populations. In contrast, recent economic growth in Brazil, India and Vietnam reflects a “demographic dividend” of the economically active.

Demographic trends are fueling some of the events reshaping the world. But what exactly are these age-related phenomena, and why are they having such an impact now? I explored these issues in depth in my 2024 book “Demography and the Making of the Modern World.”

Below is a rundown on some of the main demographic dynamics that are changing the world.

Young populations

Having a high proportion of a population age 14 and under is something generally found in poorer countries, and it usually means a huge demographic drag on economic performance.

We see this in Angola, Niger and Somalia, all of which have between 45% and 50% in that age group — compared to around 17% in the United States.

Having such a large proportion of society in their early childhood means fewer workers are supporting a vast number of citizens not in the workforce – and that leads to reduced savings rates and slower economic growth.

Countries still at this early stage of the demographic transition from high to low birth rates often have limited economic opportunities.

The youth bulge

Baby booms, the result of high fertility rates, are inevitably followed by a “youth bulge.” This is defined as a country with a larger than average proportion of people ages 15 to 29.

This bulge is linked to an increase in political instability and the possibility of increased political violence.

Research has found that countries with more than 60% of their population under 30 are four times more likely to experience outbreaks of civil conflict.

So it is of little surprise that countries that have experienced mass political protests of late have a significant youth bulge. In Bangladesh, which saw its government toppled by mass protests in 2024, 53% of the population is under 30. Iran, where major protests in January were brutally repressed, has between 50% and 60% under 30. And in Sri Lanka, the site of major protests in 2022, 48% of the population is under 30.

This isn’t an entirely new phenomenon. The Arab Spring uprisings of 2011-12 owe much of their origin to a youth bulge in the Middle East. At the time, the portion of the population under 30 in Egypt, one of the epicenters of the uprising, was 60%-65%.

When economies cannot create enough jobs for a large youth cohort, unemployment among educated young people can cause widespread frustration and a sense of political marginalization, which can sometimes turn into violent methods to effect change.

Societies with high percentages of young people, both under 15 or in places with a youth bulge, can have other serious global knock-on effects. For example, while there are many reasons behind new immigration flows, an underlying driver of departures – from Africa and the Middle East in particular – is a lack of opportunity at home and the promise of better opportunities abroad for this burgeoning population.

The demographic dividend

As youthful countries age, a phenomenon called a “demographic dividend” can occur. That’s when a higher proportion of people in the more economically active 15-64 age group emerges.

From 1970 to 2000, the rapid economic growth of East Asian economies, Western Europe and the U.S. was tied to this demographic dividend.

Today, countries with demographic dividends such as Vietnam, with 70% of the population ages 15-64, have the opportunity for impressive growth rates.

And while sub-Saharan Africa has many problems now, partly as a result of a large population under 15, it can look forward to the potential of a huge demographic dividend in the future.

The aging population

The window of opportunity created by the demographic dividend does not last forever. As longer life expectancy kicks in, so too does the population age.

China has now aged out of its dividend, and Brazil’s is coming to an end. In China, the population over 65 will reach 28% by 2040 – more than double what it was just 15 years ago.

In super-aged countries, such as Japan and Italy, the 65-and-over population now accounts for 25%-30% of the total population.

And that can be a huge problem.

A graying population can dampen economic growth. In the U.S., people over 65 are the fastest-growing cohort, and they tend to be high-propensity voters who pressure the government to extend retirement benefits, leading to a massive flow of wealth transfer from the shrinking working population to the expanding number of retirees. In 1950, there were 16.5 workers for every beneficiary of Social Security in the United States. By 2023, this figure had fallen to 2.7 workers per beneficiary.

A second demographic dividend can occur if an aging population has enough savings and asset accumulation to pass on to younger generations. But this wealth transfer can increase inequality, as those who receive substantial inheritance will be better positioned than those who do not.

In most graying societies, there are often acrimonious debates about how governments should pay for the benefits for an increasingly elderly population from the wages of a reduced working-age population.

Solutions such as increasing retirement age, reducing benefits or imposing higher taxes come with political costs. President Emmanuel Macron’s government in France, for example, has been periodically threatened by popular protest against cuts in social welfare, especially retirement benefits.

At the latter stages of the transition, aging richer countries now require workers from overseas – but are coming up against a nativist backlash. A combination of slowing economies and new streams of immigrants are creating a volatile politics conducive to the rise of authoritarianism and xenophobia. In this way, the rise of a populist nationalism in the U.S. and across Europe is linked to an increasingly aging population.

The shrinking world

As birth rates fall, the shrinking of a nation’s population is often worrisome for political elites, who tend to see a large population as a source of power.

It explains the official encouragement of higher birth rates in China and Russia through pronatal policies such as tax breaks and fiscal incentives. Even the U.S. administration has mused how to increase birth rates.

But governments have little power when it comes to encouraging women to have more children.

Population size can influence geopolitical rivalries. India is in the fortunate position of a demographic dividend that may last for several more decades. By 2100, the population of India is estimated to be roughly 1.5 billion; China’s is forecast to be 800 million. And that could change the dynamic between the two longtime rivals.

Meanwhile, Russia’s population continues to fall due to very low birth rates. This population crisis feeds into a post-imperial syndrome, where the decline of empire and power status invokes a sense of loss of self-importance that gives rise to resentment and an unwavering commitment to retain great power status.

How governments and societies adapt to population change is key: Demographic dividends can be squandered and aging populations can enrich societies, if played right. Demography is undoubtedly a vital force in contemporary events – but it is also not a predetermined destiny.

About the Author:

John Rennie Short, Professor Emeritus of Public Policy, University of Maryland, Baltimore County

This article is republished from The Conversation under a Creative Commons license. Read the original article.

By Parker Bach, University of North Carolina at Chapel Hill 

Though prediction markets have been legal in the U.S. for less than 18 months, they can’t stop making news and making money.

On prediction markets such as Kalshi and Polymarket, users can stake real money on just about anything, from the winner of the 2028 U.S. presidential election to when Taylor Swift will get married.

But this isn’t simple entertainment: In theory, these wagers serve as a means of collecting the public’s insights into the future.

That’s why you may have seen CNN’s pundits casually mention Kalshi’s election odds for the 2026 primaries, or watched CBS offer real-time Polymarket projections of which actors would win awards during the Golden Globes.

Existing research on the principles and history of prediction markets suggests they can be a valuable way of pooling collective knowledge about the future.

But as researchers like me, journalists and legislators race to understand the impact these markets are having on society and politics, several questions have emerged about the regulation of these platforms and their forecasting abilities.

The what and why of prediction markets

In practice, prediction markets are quite simple.

Each market offers what are known as “event contracts” on whether some future outcome will occur. Each contract costs between 1 and 99 cents, paying out US$1 if the event occurs or nothing if it does not.

Similar to sports betting, purchasing a contract represents a wager. There are higher returns for positions on outcomes deemed less likely. Like in the stock market, a trader can buy and sell contracts over time, as odds – and thus prices – fluctuate.

At the time of writing, Kalshi traders put the odds of the passage of the SAVE Act, legislation centered on requiring proof of U.S. citizenship to register to vote, at about 10%. So each contract for this outcome costs 10 cents. If I think the act is more likely to pass than that, I could purchase some “shares” and sell them at a higher price if the odds go up in the future. If I hold them and the bill ultimately becomes law, I would receive a return that’s 10 times what I originally paid.

Two theories support the idea that prediction markets should excel at forecasting: the wisdom of crowds and the efficient market hypothesis.

First described over a century ago, the wisdom of crowds refers to the idea that the median judgment of a large, diverse group of people operating independently is often more accurate than that of a single expert.

A related argument appears in the efficient market hypothesis, which emerged in the mid-20th century among economists who championed free markets. It holds that prices encode all available information, reflecting the collective judgments of profit-seeking sellers and deal-seeking buyers.

At their best, then, prediction markets aggregate collective intelligence to weigh the likelihood of future events.

Polling’s credibility crisis creates an opening

Gambling on the outcomes of the day’s events has a long history. In 16th-century Italy, gamblers could wager on the election of civic magistrates and the outcome of papal conclaves. And from the 1880s to 1930s, New York City was the hub of political wagering, which sometimes exceeded the stock market in daily volume.

Reporting on bets ahead of the 1924 presidential election, The New York Times observed, “It is an old axiom in the financial district that Wall Street betting odds are ‘never wrong.’”

However, the rise of scientific polling and legal crackdowns on political wagering forced prediction markets to fade to the background.

That changed in 2024.

One month before the U.S. elections, a federal court granted the prediction market startup Kalshi permission to legally operate prediction markets concerning U.S. election results.

Around the same time, Elon Musk posted on X about Donald Trump leading Kamala Harris in prediction market odds. Trump followed suit. Kalshi put up billboards with live election odds in Times Square. Users and dollars flowed in. By election day, a volume of over $500 million in presidential election bets had been traded on Kalshi alone. Polymarket featured over $3.6 billion more in volume.

Political polling, meanwhile, was facing a crisis of confidence. Response rates had been declining for decades, and Trump voters had been undercounted in 2016 and 2020.

The polls forecast the presidential election as a coin toss. The prediction market, meanwhile, favored Trump at roughly 60% odds to win.

After Trump won at the ballot box, prediction markets declared victory over polling as the new, trustworthy forecasters of public opinion.

The utility of the markets

Over the past 50 years, journalists have increasingly incorporated quantitative data in their reporting, and audiences have come to expect political forecasting as part of their news diet.

With polling experiencing a crisis of confidence, prediction markets have become an increasingly attractive way for journalists to offer a data-backed snapshot of public beliefs.

Prediction markets have other advantages over polls for journalists. They respond to events in real time, and they’re free to access. Polls, meanwhile, take time and money to administer. They provide forecasts for political outcomes that go beyond elections – such as Cabinet nominations and Supreme Court decisions – which are usually outside the purview of polling.

In recent months, Kalshi and Polymarket have inked several partnership deals with news outlets. There’s a symbiotic relationship at play: Prediction markets provide journalists with data to report and discuss. Journalists, in turn, legitimize prediction markets by citing them as a trusted source.

Prediction markets have historically performed well on elections. Whether they’re more accurate than polls on other kinds of questions is still up for debate.

If traders behave purely rationally, in the economic sense, they might flit between positions to maximize profit based on new information, personal biases aside.

But when wagering on elections, most traders have seemed to consistently buy and sell only one position, rather than switching between them. They may think they’re trading rationally while exhibiting a “wishful thinking” bias. Or, like many sports bettors, they may be wagering out of fandom or for entertainment.

All of these scenarios could undercut the accuracy of these markets.

The elephant in the room

Many journalists are embracing the data even as their news outlets run stories about concerns over insider trading in predictive markets. Because the outcome of events is often determined by human actors, those privy to certain plans – say, a looming ceasefire deal – would have access to information not available to the public and could profit handsomely off that information.

Two anonymous accounts made hundreds of thousands of dollars predicting the downfall of Nicolás Maduro and betting on the toppling of Ayatollah Ali Khamanei, with traders putting their money down just before the U.S. took military action. This timing has raised some eyebrows.

Kalshi prohibits insider trading, and in early 2026 it fined and suspended two high-profile traders who were using inside information.

Likely in response to bad press and statements from lawmakers seeking to regulate the platforms, Kalshi and Polymarket also announced new insider trading rules on March 23, 2026, centered on politics and sports.

The legal mechanisms for enforcing these rules, however, are less clear. SEC Rule 10b5-1 prohibits trading securities on the basis of material nonpublic information.

But event contracts are not governed by the SEC. They’re under the purview of the Commodity Futures Trading Commission, a much smaller agency. As things stand, the small agency has too few employees to regulate the legality of specific event contracts, which are governed by the Commodity Exchange Act. Kalshi and certain other prediction market platforms are instead given the latitude to self-certify the legality of each contract.

Any efforts to meaningfully regulate insider trading would, in my view, require clear rules and viable enforcement mechanisms.

From participation to profit

As I conduct my research, I often consider what the booming popularity of prediction markets says about American culture and politics in 2026.

In 1969, sociologist Erving Goffman theorized that Americans’ attraction to gambling stemmed from a need for “action” in an increasingly bureaucratized society. Similarly, studies have suggested that betting on sports makes fans feel like they’re participating, not just observing.

Congress is less productive than ever. Most Americans feel they have little influence over the workings of the government, with many looking on helplessly as democratic guardrails have been dismantled.

Who knows what will happen in the coming year. The filibuster might be weakened, or the U.S. could invade Cuba. Most Americans will have little say. But prediction markets at least offer the chance to make a buck off the action.

About the Author:

Parker Bach, PhD Student in Media and Communication, University of North Carolina at Chapel Hill

This article is republished from The Conversation under a Creative Commons license. Read the original article.