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Culture and household saving

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  • Guin, Benjamin

Abstract

This paper examines the role of culture in households saving decisions. Exploiting the historical language borders within Switzerland, I isolate the effect of households’ exposure to certain language groups from economic, institutional, demographic and geographic factors for a homogeneous and representative sample of households. The analysis uses the Swiss Household Panel which I complement with geographic and socio-economic data. I show that low- and middle-income households located in the German-speaking part are more than 11 percentage points more likely to save than similar households in the French-speaking part. In line with the existing literature, I show that these differences across language regions are consistent with different distributions of time preferences. By contrast, I do not find clear evidence for risk sharing during times of financial distress. JEL Classification: Z1, D12, E21, D91

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  • Guin, Benjamin, 2017. "Culture and household saving," Working Paper Series 2069, European Central Bank.
    • Handle: RePEc:ecb:ecbwps:20172069
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    More about this item

    Keywords

    culture; household economics; household finance; language; saving;
    All these keywords.

    JEL classification:

    • Z1 - Other Special Topics - - Cultural Economics
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making

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