Measuring Personal Savings, Consumption, and Disposable Income in Canada
This paper highlights the fact that more adequate measurement of personal savings as well as a consumption and disposable income in Canada yields a totally different picture from that projected by the National Accounts (NIEA). The author measures of consumption excludes purchases of durables but includes their depreciation. Savings are measured as the change in the net real market value of the end-of-year balance sheet. While, according to the NIEA, the savings/income ratio reached 15 percent in 1981, their measure suggests that this ratio was negative and amounted to -10.5 percent! In conclusion, possible implications of the mismeasurement of savings on economic policy decisions are considered.
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Volume (Year): 25 (1992)
Issue (Month): 3 (August)
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