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Triggering precaution: Heat stress and the Chinese household saving puzzle

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  • Liu, Xinheng
  • You, Taohong
  • Yang, Xin
  • Shi, Luqing

Abstract

Utilizing survey data from the 2010–2022 China Family Panel Studies (CFPS), we investigate the Chinese household saving puzzle through the lens of heat stress. Our results show that heat stress substantially elevates household saving rates by amplifying income and expenditure uncertainties, consistent with a precautionary savings motive. Furthermore, this effect is stronger among agricultural households, those without commercial insurance, and those with lower social capital.

Suggested Citation

  • Liu, Xinheng & You, Taohong & Yang, Xin & Shi, Luqing, 2025. "Triggering precaution: Heat stress and the Chinese household saving puzzle," Economics Letters, Elsevier, vol. 253(C).
    • Handle: RePEc:eee:ecolet:v:253:y:2025:i:c:s0165176525002459
    DOI: 10.1016/j.econlet.2025.112408
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    References listed on IDEAS

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    1. Zhang, Jing & Lin, Xiaole & An, Qiguang, 2026. "Dynamic response of the natural interest rate to extreme climate," Research in International Business and Finance, Elsevier, vol. 81(C).

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