Did Japanese consumers become more prudent during 1998-1999? Evidence from household-level data
This paper explores empirically whether Japanese consumers became more prudent in the second half of the 1990s, a decade in which Japan registered historically low economic growth. Employing the methodology developed by Dynan (1993), this study uses micro-level data from the Family Savings Survey and the Family Income and Expenditure Survey to estimate the coefficient of prudence for Japanese households in the second half of the 1990s. The estimates reveal that the coefficient of prudence is positive and statistically significant in the 1998-1999 period. The obtained value for the coefficient of prudence is four, which is much higher than that estimated for US households (not significantly different from zero) or UK households (around 2). The estimated coefficient for young households is higher still, which is consistent with simulation studies conducted by Gourinchas & Parker (2002) showing that precaution is the most important saving motive for younger households.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Volume (Year): 20 (2006)
Issue (Month): 2 ()
|Contact details of provider:|| Web page: http://www.tandfonline.com/RIEJ20|
|Order Information:||Web: http://www.tandfonline.com/pricing/journal/RIEJ20|
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Horioka, Charles Yuji & Watanabe, Wako, 1997.
"Why Do People Save? A Micro-Analysis of Motives for Household Saving in Japan,"
Royal Economic Society, vol. 107(442), pages 537-552, May.
- Horioka, C.Y. & Watanabe, W., 1996. "Why Do People Save? A Micro-Analysis of Motives for Household Saving in Japan," ISER Discussion Paper 0412, Institute of Social and Economic Research, Osaka University.
- DREZE, Jacques H. & MODIGLIANI, Franco, "undated".
"Cosumption decisions under uncertainty,"
CORE Discussion Papers RP
119, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Merrigan, Philip & Normandin, Michel, 1996.
"Precautionary Saving Motives: An Assessment from UK Time Series of Cross-Sections,"
Royal Economic Society, vol. 106(438), pages 1193-1208, September.
- Philip Merrigan & Michel Normandin, 1994. "Precautionary Saving Motives: An Assessment from U.K. Time Series of Cross-Sections," Cahiers de recherche CREFE / CREFE Working Papers 29, CREFE, Université du Québec à Montréal.
- Orazio P. Attanasio & Hamish Low, 2000.
"Estimating Euler Equations,"
NBER Technical Working Papers
0253, National Bureau of Economic Research, Inc.
- Karen E. Dynan, 1993. "How prudent are consumers?," Working Paper Series / Economic Activity Section 135, Board of Governors of the Federal Reserve System (U.S.).
- Giucca, P. & Jappelli, T. & Terlizzese, D., 1992.
"Earning Uncertainty and Precautionary Saving,"
161, Banca Italia - Servizio di Studi.
- HORI Masahiro & SHIMIZUTANI Satoshi, 2002. "Micro Data Studies on Japanese Household Consumption," ESRI Discussion paper series 015, Economic and Social Research Institute (ESRI).
- Pierre-Olivier Gourinchas & Jonathan A. Parker, 1999.
"Consumption Over the Life Cycle,"
NBER Working Papers
7271, National Bureau of Economic Research, Inc.
- Christopher D Carroll, 1990.
"Buffer-Stock Saving and the Life Cycle/Permanent Income Hypothesis,"
Economics Working Paper Archive
371, The Johns Hopkins University,Department of Economics, revised Aug 1996.
- Christopher D. Carroll, 1996. "Buffer-Stock Saving and the Life Cycle/Permanent Income Hypothesis," NBER Working Papers 5788, National Bureau of Economic Research, Inc.
- A. Sandmo, 1970. "The Effect of Uncertainty on Saving Decisions," Review of Economic Studies, Oxford University Press, vol. 37(3), pages 353-360.
- HORI Masahiro & HSIEH Chang-Tai & MURATA Keiko & SHIMIZUTANI Satoshi, 2002. "Did the Shopping Coupon Program Stimulate Consumption? Evidence from Japanese Micro Data," ESRI Discussion paper series 012, Economic and Social Research Institute (ESRI).
- Dynan, Karen E, 1993. "How Prudent Are Consumers?," Journal of Political Economy, University of Chicago Press, vol. 101(6), pages 1104-1113, December.
- Kimball, Miles S, 1990.
"Precautionary Saving in the Small and in the Large,"
Econometric Society, vol. 58(1), pages 53-73, January.
- Miles S. Kimball, 1989. "Precautionary Saving in the Small and in the Large," NBER Working Papers 2848, National Bureau of Economic Research, Inc.
- Lusardi, Annamaria, 1998. "On the Importance of the Precautionary Saving Motive," American Economic Review, American Economic Association, vol. 88(2), pages 449-453, May.
- C. Y. Horioka & H. Fujisaki & W. Watanabe & T. Kouno, 2000.
"Are Americans More Altruistic than the Japanese? A U.S.-Japan Comparison of Saving and Bequest Motives,"
International Economic Journal,
Taylor & Francis Journals, vol. 14(1), pages 1-31.
- Charles Yuji Horioka & Hideki Fujisaki & Wako Watanabe & Takatsugu Kouno, 2000. "Are Americans More Altruistic than the Japanese? A U.S.-Japan Comparison of Saving and Bequest Motives," NBER Working Papers 7463, National Bureau of Economic Research, Inc.
- Christopher D. Carroll, 1992. "The Buffer-Stock Theory of Saving: Some Macroeconomic Evidence," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 23(2), pages 61-156.
- Hayne E. Leland, 1968. "Saving and Uncertainty: The Precautionary Demand for Saving," The Quarterly Journal of Economics, Oxford University Press, vol. 82(3), pages 465-473.
When requesting a correction, please mention this item's handle: RePEc:taf:intecj:v:20:y:2006:i:2:p:197-209. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Michael McNulty)
If references are entirely missing, you can add them using this form.