What are the causes of the growing trend of excess savings of the corporate sector in developed countries ? an empirical analysis of three hypotheses
AbstractThis paper analyzes annual accounting data for a sample of 5,000 publicly traded manufacturing firms from Germany, France, Italy, Japan, and the United Kingdom. The analysis uses data from 1997 to 2011 and finds an increasing trend of excess savings (defined as the difference between gross saving and capital formation) and a gradual decline of gross capital formation. This trend is accompanied by a steady deleveraging process and a decrease in the share of operating assets in total assets. This process is more acute among the more credit constrained, the more volatile, and the less dynamic firms.
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Bibliographic InfoPaper provided by The World Bank in its series Policy Research Working Paper Series with number 6571.
Date of creation: 01 Aug 2013
Date of revision:
Access to Finance; Economic Theory&Research; Emerging Markets; Environmental Economics&Policies; Debt Markets;
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