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Risk and savings: A taxonomy

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  • Gunning, Jan Willem

Abstract

The effect of risk on savings depends not just on preferences but also on the type of risk. This helps to explain why the empirical literature reports positive effects for developed countries but negative effects for developing countries.

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  • Gunning, Jan Willem, 2010. "Risk and savings: A taxonomy," Economics Letters, Elsevier, vol. 107(1), pages 39-41, April.
  • Handle: RePEc:eee:ecolet:v:107:y:2010:i:1:p:39-41
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    References listed on IDEAS

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    1. Martin Browning & Annamaria Lusardi, 1996. "Household Saving: Micro Theories and Micro Facts," Journal of Economic Literature, American Economic Association, vol. 34(4), pages 1797-1855, December.
    2. Kimball, Miles S, 1990. "Precautionary Saving in the Small and in the Large," Econometrica, Econometric Society, vol. 58(1), pages 53-73, January.
    3. Chris Elbers & Jan Willem Gunning & Bill Kinsey, 2007. "Growth and Risk: Methodology and Micro Evidence," World Bank Economic Review, World Bank Group, vol. 21(1), pages 1-20.
    4. Deaton, Angus, 1991. "Saving and Liquidity Constraints," Econometrica, Econometric Society, vol. 59(5), pages 1221-1248, September.
    5. Deaton, Angus, 1992. "Understanding Consumption," OUP Catalogue, Oxford University Press, number 9780198288244.
    6. Christopher D. Carroll & Miles S. Kimball, 2001. "Liquidity Constraints and Precautionary Saving," NBER Working Papers 8496, National Bureau of Economic Research, Inc.
    7. F. H. Hahn, 1970. "Savings and Uncertainty," Review of Economic Studies, Oxford University Press, vol. 37(1), pages 21-24.
    8. Lusardi, Annamaria, 1998. "On the Importance of the Precautionary Saving Motive," American Economic Review, American Economic Association, vol. 88(2), pages 449-453, May.
    9. Philippe Weil, 1993. "Precautionary Savings and the Permanent Income Hypothesis," Review of Economic Studies, Oxford University Press, vol. 60(2), pages 367-383.
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    Cited by:

    1. Berber Kramer, 2016. "When expectations become aspirations: reference-dependent preferences and liquidity constraints," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 61(4), pages 685-721, April.
    2. Victor Stephane, 2016. "How Do Natural Disasters Affect Saving Behavior?," Working Papers halshs-01409651, HAL.
    3. Alessandro Federici & Pierluigi Montalbano, 2012. "Macroeconomic volatility, consumption behaviour and welfare: A cross-country analysis," Working Paper Series 3612, Department of Economics, University of Sussex Business School.
    4. Vergara, Marcos, 2017. "Precautionary saving: A taxonomy of prudence," Economics Letters, Elsevier, vol. 150(C), pages 18-20.
    5. Georgescu, Irina & Kinnunen, Jani, 2020. "The interest rate for saving as a possibilistic risk," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 547(C).
    6. Donatella Baiardi & Marco Magnani & Mario Menegatti, 2020. "The theory of precautionary saving: an overview of recent developments," Review of Economics of the Household, Springer, vol. 18(2), pages 513-542, June.
    7. Martijn Boermans & Daan Willebrands, 2012. "Financial constraints, risk taking and firm performance: Recent evidence from microfinance clients in Tanzania," DNB Working Papers 358, Netherlands Central Bank, Research Department.
    8. Emiliano Magrini & Pierluigi Montalbano, 2012. "Trade openness and vulnerability to poverty: Vietnam in the long-run (1992-2008)," Working Paper Series 3512, Department of Economics, University of Sussex Business School.

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    More about this item

    Keywords

    Investment under risk Precautionary savings Labor income risk Asset risk;

    JEL classification:

    • D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance

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