Household Savings

A lakossági megtakarítások változása 2006 és 2010 között Bevezetés Az 1990-es évek gazdasági mutatóinak alakulását a piacgazdaságra való átállás folyamatai határozták meg. Mint az várható volt, az átmenet komolyan érintette a háztartások életszínvonalát is, amennyiben a lakosság reáljövedelmében az 1980-as évekre jellemző növekedés után, az 1990-es évek első felében jelentős visszaesés volt tapasztalható. A reáljövedelem csökkenése részben a reálkeresetek és reálnyugdíjak, részben pedig a foglalkoztatottsági szint visszaesésének volt a következménye. Az 1990-es évek közepétől a helyzet lényegesen megváltozott. A gazdasági recessziót követően lassan megindult a lakossági jövedelemszint emelkedése, amelynek következtében az egy főre jutó reáljövedelmek országos átlagban az ezredforduló körül elérték, majd azóta meghaladják a rendszerváltozás előtti szintet. A makrogazdasági mutatók javulása a háztartások optimista jövedelmi várakozásaiban is tükröződött. A magasabb jövedelem elsősorban a szocialista időszakban kényszerűen visszafogott fogyasztást növelte, amire a korábbinál jóval szélesebb lehetőség nyílt a fogyasztási termékek piacának látványos bővülése révén. 1. ábra: Az egy főre jutó reáljövedelem és fogyasztás indexe Forrás: KSH (2010) alapján A fogyasztás növekedése a háztartási megtakarítások rovására, jelentős hitelfelvétel mellett következett be. A 2002 és 2008 között kiemelkedő hitelvásárlási kedv meghatározó módon befolyásolta a lakosság pénzügyi helyzetét és közel nyugat-európai szintre növelte az eladósodottságot. A növekvő hitelfelvétel önmagában nem lett volna aggasztó, hiszen a Egy főre jutó reáljövedelem indexe 1990 = 100 Egy főre jutó fogyasztás indexe 1990 = 100

We recreate the NIPA adjustments pioneered by Ruggles and Ruggles (1992) for the period 1947-2012 and reconrm their results: household net lending to other sectors is counter-cyclical and is a small fraction private rms' gross capital formation (GCF). To test the causal role of household Net Savings in terms of GCF and GDP growth, a VEC model is estimated. The VECM is cointegrated stationary for the three annual time series, but exogeneity testing shows household Net Savings is exogenous. We argue this is evidence of inter-secotral investment demand as driving feature of growth.

Economists generally believe that higher savings will spur economic growth, thus strengthening the economy further. In Malaysia however, the sharp increase in the ratio of household debt to disposable income particularly over the past ten years has raised doubts on the ability of Malaysians to save and plan for their future. As a result, total household savings remained low and there is high risk that Malaysians would not have sufficient savings for their retirement. Even more worrying is that young adults reportedly are the main group who are trapped into this financial difficulty. The issue has raised concern on the needs to educate young Malaysian adults on the fundamental importance of savings in order to ensure financial sufficiency on their retirement. With regards to savings behavior, the needs for savings are different amongst individuals due to different mind-set, behavior, knowledge, and social environment. This study intends to explore the savings behavior amongst students of higher learning institutions in Kota Kinabalu, Sabah. Specifically, the study intends: (i) to investigate the determinants of savings behavior; and, (ii) to examine the mediating effect of attitude towards the relationship between financial literacy and savings behavior. Data was collected using structured questionnaire and analyzed using SMART-PLS, a second generation structural equation modelling software. The results indicate that family involvement plays a major role in nurturing students' savings behavior, followed by financial literacy and peer influence. In addition, students are said to have more favorable financial attitude when they are financially literate. Financial attitude however, does not mediate the relationship between financial literacy and savings behavior. This research is expected to contribute to the body of knowledge within the financial wellness and personal financial planning context.

This thesis assesses the social-welfare implications of modifications to the post transfer distribution of income, in the context of welfare maximising policy design. Both the inequality-distributional efficiency and inequality-growth relationship are assessed. An Atkinson social welfare function is employed in a novel fashion to model the inequality distributional efficiency relationship, including direct effects that result from the concavity of the personal utility function, and external losses operating via positional income effects. This analysis produces estimates of the social welfare losses from inequality across a data set of 137 countries, where the unweighted average of total losses is found to be equivalent to be 47% of GNI. The equality-growth relationship is analysed from the standpoint of both endogenous growth theory and post-Keynesian theories of demand and investment. The relationships between the functional and personal distribution of income and key macroeconomic variables including the rate of savings, and physical and human capital accumulation are assessed. Crucially, these relationships are found to be highly modifiable by economic policy and structural reform, and in theory, no growth–equality trade off need exist. On the contrary, equality may be growth promoting at moderate to high inequality levels. Combined with the large static welfare losses from inequality uncovered in this analysis, the welfare optimum level of inequality is likely to be close to the level associated with distributional efficiency maximisation. This is likely to be a very low level of inequality in comparison to existing levels in most countries and regions, and large welfare losses result from levels of inequality significantly above this level.

Understanding the motives that underlie Spaniards’ retirement saving decisions is important because many, if not most, future retirees will need to rely on personal savings to maintain a decent standard of living. The governor of the Bank of Spain has stated recently that the current public pension system will not guarantee an adequate pension to the citizens, advising to save now for retirement. In this debate on public pensions, and the complementary role that private pensions might play in Spain, this article has shed light on the decision of Spanish households to engage in individual pension plans and it has identified which factors determine the total amount saved in such retirement plans. Using micro data from the Bank of Spain (Survey of Household Finances 2011), the analysis has revealed that the expectations of lower future income, along with preferences for the financial risk and education, exert an important influence on the likelihood of enrolling in a private pension plan. University education minimizes the myopic behavior of households in the sense of making them more forward-looking and cautious in the face of their future well-being. Additionally using Heckman’s methodology to correct for the problem of selection bias, our results have revealed that liquidity constraints affect negatively the total amount of money saved for retirement.

This book brings together original, rich and nuanced data on the
relationship between caste and economic patterns. It looks at the relationship between caste and a whole range of variables: education, income, consumption and savings. It provides a much more sophisticated way of looking at different dimensions of inequality than is current in the literature. I will not spoil the reader’s sense of surprise by reiterating the rich statistics that follow. What I propose to do instead is explain why some of these findings may be of interest to those who are concerned about some big debates in India: the relationship between caste and inequality, appropriate development strategies, the consequences of private versus public expenditure on health and education and so forth. As such, this book provides a valuable starting point for a range of important discussions in contemporary India.

Bangladeshi earnings capable residents plan to finance from their bonuses, salaries, and savings etc. as the sources of festival financing to meet the expenditure related to celebrate the festivals. Peoples spent more on purchasing dress, festivals items for the festival day entertainment and transportations.  Study finds that males are spending more than the females to celebrate the festivals. Study finds positive correlation between festivals financing and expenditure. However, there is a negative correlation exists between the scope of savings and festival expenditures. Bangladeshi people have a little chance to save from festival financing.  Ranking shows that, peoples give more emphasize on religious festivals than other types of festivals like family festivals, social festivals, national festivals etc. To celebrate festivals, people spend more on purchasing new dresses. People can save a portion of money during festivals if they reduce the purchasing more than one new dress and reduce the festivals items to entertain.

Savings level in African countries has suffered greatly since financial liberalisation and private savings has subsequently contributed less to the Gross Domestic Product of these emerging economies. South Africa is known for having one of the lowest level of domestic savings in Africa with a great dependency on high interest rates to attract foreign capital to boost the economy and regain balance in the balance of payment account. South African Reserve Bank has adopted an inflation target policy where it sets interest rates in accordance with inflation targets as set by the South African government between 3 and 6 percent. Inflation is known to corrode savings and inflation targets could potentially safe guard domestic private savings and liberate South Africa from its high dependency on foreign capital inflows and have a better control of foreign debt.

As a result of the neoliberal economic philosophical doctrines that spread in the 1980s, decreasing attention was paid by researchers and other experts in the European Union to developments in households' financial position and consumption in boosting economic growth. This is despite the fact that the examples set by the increasingly faster growing countries, especially India, China, Brazil, Mexico and South Africa, seem to markedly confirm that developments in incomes and household consumption have an increasing role in the acceleration of economic growth. As globalization and the 2008 economic crisis undermined the financial position of households in the European Union, and thus also in Hungary, and a growing part of the population was thrust into increasingly deeper poverty, so people started to become once again aware of the actual consequences of deterioration in households' financial position on developments in economic growth. Having recognised all this, the Hungarian government fundamentally altered Hungarian economic policy. Tax hikes were replaced by tax cuts, and previous high taxes were replaced by tax credits to facilitate households' position. In contrast to the previous austerity packages, actions were taken with the primary aim to increase the income left with households. This is also the purpose of the utility cost cut procedure. In this framework, long-term changes were performed with the aim to allow the government ensure public services in the field of waste water management, drinking water, natural gas and electricity supply, district heating, waste incineration and mass catering on a non-profit basis, in order to increase the income

In this paper, United States Panel study of income dynamics (PSID) family and individual data for 2009-2013 is used to elaborate the life cycle hypothesis of savings by focusing on the topic of savings after retirement. Mainly, paper investigates the determinants of saving after retirement by answering the life cycle hypothesis of saving on dissaving expectations for elderly after retirement. Besides that, paper investigates the household based heterogeneity of saving behaviour after retirement by focusing on retirement wealth, household composition, education and  financial products. OLS, fixed and random effects approach has been used to see impact of unobserved heterogeneity.

The Refund to Savings (R2S) initiative, a product
of a unique collaboration among partners
from academia and industry, seeks to improve
the financial security of low- and middle-income
(LMI) households by promoting saving of federal tax
refunds. Researchers from Washington University
in St. Louis and Duke University have worked with
Intuit, Inc., the maker of TurboTax software, to
design and test scalable interventions that encourage
tax filers to save a portion of their federal tax
refunds and that streamline the process of depositing
refunds directly to savings vehicles. These computerbased
interventions are low cost and low touch;
that is, only a minimal investment of personnel
is required to deliver the interventions to great
numbers of people.

This paper describes the composition and distribution of household wealth in Italy. First, the evolution of household portfolios over the last 40 years is described on the basis of newly reconstructed aggregate balance sheets. Second, the characteristics and quality of the main statistical source on wealth distribution, the Bank of Italy’s Survey of Household Income and Wealth, are examined together with the statistical procedures used to adjust for nonresponse, nonreporting and underreporting. The distribution of household net worth is then studied using both adjusted and unadjusted data. Wealth inequality is found to have risen steadily during the 1990s. The increased concentration of financial wealth was an important factor in determining this path.

Development economics has for several decades recognized the importance of the mobilization of domestic savings for economic growth in developing countries. The positive relationship between saving/investment and economic growth has long been an established fact in economics. 1

Les catégories qui permettent de recenser les budgets domestiques font l’objet d’opérations de traduction de la part de divers agents d’institutions (conseillers bancaires, travailleurs sociaux, etc.) lorsqu’elles s’appliquent aux économies domestiques des milieux populaires. Leur contenu normatif est ainsi souligné: elles reposent sur des représentations, socialement situées, de l’unité domestique (le ménage), et du temps (le mois), susceptibles de faire peser une «double peine» économique sur les budgets populaires.

The purpose of the study is to investigate the situation and dynamics of the components of financial security of Ukraine in terms of household savings influence on them. Methods of theoretical and statistical analysis allowed to define the components of financial security, to assess deviations of financial security parameters in Ukraine from their standard levels, to identify and analyze domestic and global trends that make influence on financial security of Ukraine, to disclose correlation between the changes in forms of savings and dynamics of financial security components, to substantiate foreground saving and investment policy implications for the government. Based on juxtaposition of currency, debt and budget security parameters, as well as on comparison of security indicators of insurance and money markets of Ukraine with their limit values, threats to a domestic financial system sustainability caused by underuse of household savings as investment resource are identified. Results obtained are aimed at solving the problem of strengthening financial security of the state by means of stirring up saving process in Ukraine.

This study analyzed the relationship between financial knowledge and household saving behavior using the 2016 Survey of Consumer Finances (SCF) dataset. The results from a hierarchical model showed that both objective knowledge and perceived financial knowledge were positively related to the likelihood of being a saver. The explanatory power of the regression models increased significantly when financial knowledge variables were added. Furthermore, the results were robust across different measurements of household savings and additional analyses using the 2015 National Financial Capability Study (NFCS) dataset. Educators, policymakers, and financial institutions can benefit from these results as they develop programs, policies, and products to motivate and promote saving behavior.

Just a short and not very doctoral analysis about the no so clear causal relation between education, growth, and savings. I wandered about which of these socioeconomic variable comes first and the theoretical reasons of that specific causality. I tried to present some empirical evidence. I concluded that socioeconomic reality is not as simple as many macroeconomists continue suggesting. Nonetheless, I suggested a possible causality path that depends on the intertemporal scope of the analysis (long vs short term), that showed a very complex system of “unknown” interactions. For the time being, only the micro data analysis seem to provide a solid but complex framework of future investigation.

The article explores the effects of the living standard parameters on dynamics of households’ savings. It is shown that the current state of saving process in Ukraine inherits a number of negative trends caused by the overall decline in the quality of living. The authors conclude that growth of households’ real income in the long run, on the one hand, and creation of favorable saving climate, on the other hand, will contribute to transformation of people’s savings into organized forms, enhance investment capacities of the national economy, and increase the Ukrainian society well-being.

Economic decisions of households are determined by current and prospective financial situation, above all, the level of income generated. Economic decisions regarding the collection of financial savings and investing them in financial instruments have been determined by the changing market environment, including the situation on the labor markets, products and services and offer financial institutions. The ability to generate savings increases when the purchasing power of income increases. Recent years have seen an increase in the surplus revenue in relation to expenditures, which enabled families to farm-leading speech-saving increase in the scale of financial surpluses. In recent years, the global financial crisis in 2008, economic conditions in the global and domestic economy's Started to gradually improve. In the same period, the income situation of households in Poland also began to improve what was also a determinant of propensity to save and invest surplus financial instruments held for investment offered by financial institutions.

Ülke ekonomilerinin gelişimi açısından yatırımlar, yatırımların finansmanı ve sürdürülebilirliği açısından ise tasarruflar önemli bir rol oynamaktadır. Yurtiçi tasarrufların yetersiz kaldığında ülkeler yatırımların finansmanı için yurt dışı kaynaklara bağımlı hale gelmektedir. Bu durum ise ekonomilerdeki kırılganlıkları artırmaktadır. Bu nedenle düşük tasarruflara sahip ülkeler yurtiçi tasarruflarını artırmak zorundadır. Düşük yurtiçi tasarruflara sahip olan Türkiye’nin tasarrufları artırmak için aksiyon alması kaçınılmazdır. Bunun için öncelikle düşük tasarruflara neden olan hususlar belirlenmelidir. Çalışmamız bu amaca yönelik hazırlanmış ve bu kasamda 289 katılımcı ile anket çalışması yapılmıştır. Analiz sonuçlarına göre gelir ve eğitim düzeyi ile tasarruf oranları arasında doğrusal bir ilişki bulunmaktadır. Diğer taraftan dışarıda yemek yeme alışkanlığı ve kredi kartı kullanım hacmi yüksek olan bireylerde tasarruf eğilimi düşüktür. Çalışmamızda elde edilen bir diğer önemli sonuç ise olası bir ek geliri tasarruf etmek yerine harcamayı tercih eden kişilerin normal yaşantılarında da tasarruf yapmamalarıdır. Bu çalışmada belirtilen hususların Türkiye’de düşük tasarruf sorununun çözülebilmesi ve tasarrufların artırılabilmesi için düzenleyici otoritelere yol gösterici olacağı düşünülmektedir.

The main aim of the paper is to present the size of the savings that can be created by households which achieved low utilities income. The analysis includes the theoretical basis of the measurement of income utility and presentation of the savings in the group of households which
received income referred to as low useful. The empirical part of the article is based on the results of the research project carried out by the “Centre for Education and Enterprise Support” Association under the title “Study of utility of income in Polish households and its impact on the
households”. Statistical analysis is performed on data from the household Budget survey conducted by the Central Statistical Office. This article is based on the development of their own CSO figures. GUS is not responsible for the conclusions contained in the publication. The results obtained indicate that the deriving income which are assessed as less useful not necessarily exclude the appearance of savings in such households. The percentage of savers increases with the transition to higher degrees assess the utility of income. Also the nominal value of the savings increase with the transition to a group of households assessing their income as more useful.

The article investigates trends in the saving activity o f the population o f Belarus and Ukraine in the
context of the economic crisis and post-crisis period. The empirical analysis o f the statistical data was held:
features of formation of population saving rates in Belarus and Ukraine in the presence of structural breaks
were revealed. The main prerequisites for enhancing saving activity of the population were underlined.

We update the NIPA adjustments pioneered by Ruggles and Ruggles (1992) for the period 1947-2012 and reconfirm their results: household net lending to other sectors is counter-cyclical and is a small fraction private firms' gross capital formation (GCF). To test the causal role of household Net Savings in terms of GCF and GDP growth, a VEC model is estimated. The VECM is cointegrated stationary for the three annual time series, but exogeneity testing shows household Net Savings is exogenous. We argue this is evidence of intersecotral investment demand as driving feature of growth.

Understanding the motives that underlie Spaniards’ retirement saving decisions is important because many, if not most, future retirees will need to rely on personal savings to maintain a decent standard of living. The governor of the Bank of Spain has stated recently that the current public pension system will not guarantee an adequate pension to the citizens, advising to save now for retirement. In this debate on public pensions, and the complementary role that private pensions might play in Spain, this article has shed light on the decision of Spanish households to engage in individual pension plans and it has identified which factors determine the total amount saved in such retirement plans. Using micro data from the Bank of Spain (Survey of Household Finances 2011), the analysis has revealed that the expectations of lower future income, along with preferences for the financial risk and education, exert an important influence on the likelihood of enrolling in a private pension plan. University education minimizes the myopic behavior of households in the sense of making them more forward-looking and cautious in the face of their future well-being. Additionally using Heckman’s methodology to correct for the problem of selection bias, our results have revealed that liquidity constraints affect negatively the total amount of money saved for retirement.

ObjectivesThis study evaluated decisions related to debt and savings on physical health, emotional health and health behaviours.MethodsThe longitudinal data from the Polish biennial household panel—Social Diagnosis Survey—were used. Evidence for a link between credit/savings and health/health behaviours was presented using three waves of the data and an outcome-wide regression analysis. To circumvent endogeneity, variables temporally prior to exposure were used as controls. Sensitivity analysis for unmeasured confounding, conducted using E-values, provided a check for robustness.ResultsDebt proved a significant stressor, affecting three of five physical health measures. Over-indebted individuals suffered even more in terms of physical health outcomes. The role of savings in physical health was much less significant, yet had significant bearing on measures of emotional health. In terms of emotional health, debt (over-indebtedness in particular) influenced loneliness and increased suicidal thoughts. With respect to health behaviours, savings appeared significant in reducing smoking and increasing uptake of sport activities, while debt had no significant effect in these areas.ConclusionsRecommendations are formulated to foster saving activity and develop institutional solutions for over-indebtedness.

Consumption has increased worldwide during 20th century. Temporal changes in consumption provide insights into the status of welfare. Food consumption pattern of household is an important barometer of individual welfare and well-being in any country. Further, reforms led to increase in well being and thereby saving and consumption. Together with the exposure to modern ways and the availability of modern consumable goods and services in the market, nonfood consumption became prominent in the consumption basket of Keralites. Growth in the consumer goods industries and a shift in the policies of the government towards a market oriented economy have further accelerated a change in the consumption pattern. The various channels of saving promoted saving habits of households over the last three decades. Consumption and saving pattern have become interesting topics for academicians, policy researchers, and government.

This paper examines the determinants of household saving in China and India over the last few decades using the life cycle model, with appropriate modifications to account for the
expected benefits of pension saving. Consistent with the predictions made in the life cycle model, higher income growth promotes more household saving, and higher age dependency does the opposite. An increase in the inflation rate appears to encourage household saving. Interestingly, the evidence suggests that an increase in expected pension benefits tends to discourage household saving in China in the long run, but the reverse is found in India.

The concern for insufficient savings of individuals has often been the subject of economic studies. Reviewing the literature shows that scholars argue for pension reforms and contracts to achieve sufficient worker savings. While I agree with the researchers that reforms and contracts generally can guarantee greater benefits, they overlook how employer contributions influence how long people stay in the workforce over time so that the rate of benefits are maintained. As such, I estimate time-series and pooled OLS models to discover that there are short-term negative effects of changes in the labor force participation rate on the current rate, long-term positive effects of changes in pension contributions, direct and long-term negative effects of social insurance contributions, the changes in wages over time exceed the change in the labor force participation rate over time, and a strong positive effect of female employment on the change in the labor force participation rate both over time. Policy implications are discussed.

A key component in determining the savings behavior of people is the pension plan. Very few, if any, economists will disagree that higher socio-economic classes have greater potential retirement security than lower socioeconomic classes, because high socio-economic classes have more money with which to save. However, pension plans can mitigate the savings problem for low-income groups through employer provisions. Past studies make note of the effects of pension plans on allocating savings, but they overlook what influences portfolio preferences. To modernize the research in the field of pension economics by taking into account the effects of the Great Recession, I use probit and logit models to argue that Employer Matching incentivizes individuals to invest more in stocks in their pension portfolio (i.e. a more aggressive portfolio preference) and human capital generally increases the incentive to engage in aggressive pension savings behavior. Policy implications of the results are discussed.

The leverage cycles of households in Canada and the United States are com- pared to the the optimal debt/net worth ratio prescribed by a stochastic optimal control (SOC) model. The SOC model employed extends Jerome Stein’s (2003) optimal leverage metric by modeling the interest rate as a stationary, mean-reverting (Ornstein-Uhlenbeck) diffusion process and speculative capitals gains as a geometric Brownian motion with a variable trend rate. The difference between the normalized observed and optimal leverage is an early warning sign (EWS) of financial fragility. We find that Canadian households are in a fragile state. Therefore, a negative shock to the Canadian real estate sector could ignite a crisis but this is unlikely to be as severe as the US housing market crash in 2008/09."