IDEAS home Printed from https://ideas.repec.org/a/mes/jpneco/v37y2010i1p79-110.html
   My bibliography  Save this article

The Small Saving Tax Exemption and Japanese Household Asset Allocation Behavior

Author

Listed:
  • Shizuka Sekita

Abstract

In this article, I estimate asset demand equations for Japanese households using age-group data from a government survey called the Family Saving Survey, and based on the estimation results, conduct a simulation analysis of the impact of the 1988 and 2006 revisions of the Small Saving Tax Exemption for interest income (the so-called Maruyu System) on household portfolios. In the estimation, I define marginal tax rates by age group, taking into account for the first time the amount of principal that is tax exempt and estimate asset demand equations by three-stage least squares to deal with the endogeneity of rates of return, which previous analyses of the revision of the Maruyu System and of household portfolios in Japan have not done. I find that both the 1988 and 2006 revisions of the Maruyu System promote a shift in household portfolios away from Maruyu assets and toward non-Maruyu assets, as expected. However, I also find that although the percentage changes in the case of the 1988 revision are quite considerable, those in the case of the 2006 revision are quite small. Thus, it appears that the 2006 revision hardly affected household portfolio behavior at all.

Suggested Citation

  • Shizuka Sekita, 2010. "The Small Saving Tax Exemption and Japanese Household Asset Allocation Behavior," Japanese Economy, Taylor & Francis Journals, vol. 37(1), pages 79-110.
    • Handle: RePEc:mes:jpneco:v:37:y:2010:i:1:p:79-110
    DOI: 10.2753/JES1097-203X370103
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.2753/JES1097-203X370103
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.2753/JES1097-203X370103?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:mes:jpneco:v:37:y:2010:i:1:p:79-110. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/MJES19 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.