Income Risk, Saving and Taxation:Will Precautionary Saving Survive?
AbstractFormer theoretical and empirical studies find that precautionary savings are reduced inthe presence of social security systems. The saving motive, however, does not change:individuals respond to increasing income risk by increasing their savings. Although thisstill holds for common tax and transfer systems, we show that this is not a feature of alltax and transfers systems. In contrast to former studies, we focus on the impact of thevariability of future income (higher degree risk).
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Bibliographic InfoPaper provided by Ifo Institute for Economic Research at the University of Munich in its series Ifo Working Paper Series with number Ifo Working Paper No. 125.
Date of creation: 2012
Date of revision:
Income risk; saving behavior; social security; unemployment benefit; taxation;
Find related papers by JEL classification:
- D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory
- D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
- D91 - Microeconomics - - Intertemporal Choice - - - Intertemporal Household Choice; Life Cycle Models and Saving
- H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
- H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household
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ERSA conference papers
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