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Household Saving Behavior and the Influence of Family-Owned Business

Listed author(s):
  • Amber Remble

    ()

  • Maria Marshall

    ()

  • Roman Keeney

This study focused on the lifecycle income objective of business-owning (farm and nonfarm) households. We hypothesized that the complex relationship between household and business management decisions had the potential to challenge predictions from standard household savings theory. Specifically, we tested for differences in saving behavior of these entrepreneurial households relative to the average US household. A limited dependent variable model was performed, keying in on the saving behavior and ability of household respondents in the Survey of Consumer Finances for 2007. The estimation results indicated that, along with standard demographic influences of savings models, households owning a farm or nonfarm business had a significantly higher likelihood of maintaining private saving in a given year. Our results highlight the necessity for future research on household saving behavior to account for the differing objectives and choice sets faced by households that own businesses when conducting analyses of household saving. Copyright Springer Science+Business Media New York 2014

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File URL: http://hdl.handle.net/10.1007/s10834-013-9372-1
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Article provided by Springer in its journal Journal of Family and Economic Issues.

Volume (Year): 35 (2014)
Issue (Month): 3 (September)
Pages: 411-422

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Handle: RePEc:kap:jfamec:v:35:y:2014:i:3:p:411-422
DOI: 10.1007/s10834-013-9372-1
Contact details of provider: Web page: http://www.springer.com

Order Information: Web: http://www.springer.com/social+sciences/journal/10834/PS2

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  1. George W. Haynes & Rosemary J. Avery, 1996. "Family Businesses: Can the Family and the Business Finances Be Separated? Preliminary Results," Journal of Entrepreneurial Finance, Pepperdine University, Graziadio School of Business and Management, vol. 5(1), pages 61-74, Spring.
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  3. Ashok K. Mishra & Barry K. Goodwin, 1997. "Farm Income Variability and the Supply of Off-Farm Labor," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(3), pages 880-887.
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  5. Mark Kazarosian, 1997. "Precautionary Savings-A Panel Study," The Review of Economics and Statistics, MIT Press, vol. 79(2), pages 241-247, May.
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  12. Horioka, Charles Yuji & Watanabe, Wako, 1997. "Why Do People Save? A Micro-Analysis of Motives for Household Saving in Japan," Economic Journal, Royal Economic Society, vol. 107(442), pages 537-552, May.
  13. Tansel Yilmazer & Holly Schrank, 2010. "The Use of Owner Resources in Small and Family Owned Businesses: Literature Review and Future Research Directions," Journal of Family and Economic Issues, Springer, vol. 31(4), pages 399-413, December.
  14. Christopher D. Carroll & Andrew A. Samwick, 1998. "How Important Is Precautionary Saving?," The Review of Economics and Statistics, MIT Press, vol. 80(3), pages 410-419, August.
  15. Skinner, Jonathan, 1988. "Risky income, life cycle consumption, and precautionary savings," Journal of Monetary Economics, Elsevier, vol. 22(2), pages 237-255, September.
  16. Monke, James D., 1997. "Do Farmers Need Tax-Deferred Savings Accounts to Help Manage Income Risk?," Agricultural Information Bulletins 33737, United States Department of Agriculture, Economic Research Service.
  17. Avery, Robert B & Kennickell, Arthur B, 1991. "Household Saving in the U.S," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 37(4), pages 409-432, December.
  18. Lewis C. Solmon, 1975. "The Relation between Schooling and Savings Behavior: An Example of the Indirect Effects of Education," NBER Chapters,in: Education, Income, and Human Behavior, pages 253-294 National Bureau of Economic Research, Inc.
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