How do we value our income from which we save?
AbstractIn this paper we analyze the relationship between the perception of income as satisfying household needs and saving rate of this household. Using the multinomial logit regression function we measure the probability of a household to fall into one of the groups categorized by the subjective perception of income in relation to the current household disposable income. The variable specified for the valuation of income is income perception, defined as a class of observed disposable income located on the scale of the subjectively satisfying income. Factors determining the perception of income are: gender and education of the household head, family characteristics, source of income and place of residence. The analysis of relations between the income perception and the household saving rates shows that the perception of income affects both the household observed and predicted saving rates. The research is based on the Household Budget Surveys data for Poland in 2008.
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Bibliographic InfoPaper provided by Faculty of Economic Sciences, University of Warsaw in its series Working Papers with number 2011-03.
Length: 15 pages
Date of creation: 2011
Date of revision:
household; income; needs; valuation; saving; probability;
Other versions of this item:
- Liberda Barbara & Pęczkowski Marek & Gucwa-Leśny Ewa, 2012. "How Do We Value Our Income from which We Save?," Annals of the Alexandru Ioan Cuza University - Economics, De Gruyter Open, vol. 59(2), pages 93-104, December.
- D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
- D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
- D19 - Microeconomics - - Household Behavior - - - Other
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"Satisfaction and comparison income,"
CEPREMAP Working Papers (Couverture Orange)
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- van Praag, Bernard M. S., 1991. "Ordinal and cardinal utility : An integration of the two dimensions of the welfare concept," Journal of Econometrics, Elsevier, vol. 50(1-2), pages 69-89, October.
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