This paper analyses the effects of ageing on the international capital market. The first part applies a simple model and distinguishes between the cases of a small open economy and a closed economy to explore the separate effects of ageing, the design of pension schemes and government policy on savings, labour supply and the interest rate. The second part of the paper analyses cross-border capital flows and spillover effects caused by international differences in ageing patterns, pension schemes and policy reactions. The final part is devoted to the quantitative effects found by various recent simulation studies.