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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

    (OFCE - Observatoire français des conjonctures économiques (Sciences Po) - Sciences Po - Sciences Po)

Abstract

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," Post-Print hal-03403363, HAL.
    • Handle: RePEc:hal:journl:hal-03403363
    DOI: 10.24187/ecostat.2019.513.2000
    Note: View the original document on HAL open archive server: https://sciencespo.hal.science/hal-03403363
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    References listed on IDEAS

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    Cited by:

    1. António Duarte Santos & Hélio Castro, 2022. "Housing and Setting Constraints: The Portuguese Evidence," Sustainability, MDPI, vol. 14(18), pages 1-14, September.

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    More about this item

    Keywords

    Saving rate; Consumption; Permanent income; Precautionary savings; Unemployment;
    All these keywords.

    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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