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The Links between Saving Rates, Income and Uncertainty: An Analysis based on the 2011 Household Budget Survey

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  • Céline Antonin

Abstract

[eng] Using data from the 2010-2011 Insee Household Budget Survey (enquête Budget de famille), the article examines the links between the saving rate of French households and their income. It shows that the saving rate of the richest households increases with permanent income: they save more over their lifecycle. In addition, the empirical analysis makes it possible to identify and quantify a precautionary motive linked to the risk of unemployment: the precautionary motive leads to a surplus of savings flows of approximately 6.4% for working households. Furthermore, the proportion of precautionary wealth linked to uncertainty over future income is comparable, around 6.3% of overall wealth. Finally, the significance of the precautionary motive depends on the level of income, following an inverted U shaped curve: it is almost twice as strong for households in the third and fourth quintiles than for the extreme income quintiles.

Suggested Citation

  • Céline Antonin, 2019. "The Links between Saving Rates, Income and Uncertainty: An Analysis based on the 2011 Household Budget Survey," Economie et Statistique / Economics and Statistics, Institut National de la Statistique et des Etudes Economiques (INSEE), issue 513, pages 47-68.
    • Handle: RePEc:nse:ecosta:ecostat_2019_513_3
    DOI: https://doi.org/10.24187/ecostat.2019.513.2000
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    More about this item

    JEL classification:

    • C81 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Methodology for Collecting, Estimating, and Organizing Microeconomic Data; Data Access
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution

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