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Trends in household saving: a tale of two countries

Author

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  • Orazio Attanasio

    () (Institute for Fiscal Studies and University College London)

  • James Banks

    () (Institute for Fiscal Studies and University of Manchester)

Abstract

In this paper we argue that only when one uses data and arguments relating to the life-time experiences of individuals or households within an economy can one understand recent trends and patterns in saving rates. Only within this framework is it sensible to design and analyse policies to encourage saving either in the population as a whole or in particular groups of households. These issues are becoming increasingly important as income inequality increases, populations age and as proposals relating to tax harmonisation, cross-border capital flows and tax competition begin to take shape EU member states continue to show very diverse saving behaviour and governments continue to introduce tax incentive schemes designed to help particular groups. To understand the issues relating to the design of policies for household saving one must first understand how life-time profiles of consumption, income and demographic profiles have evolved and are likely to evolve in the future. We present these profiles and show how they can be used as an input into techniques designed to look at the effects of recent demographic and labour market changed on life-cycle savings profiles.

Suggested Citation

  • Orazio Attanasio & James Banks, 1998. "Trends in household saving: a tale of two countries," IFS Working Papers W98/15, Institute for Fiscal Studies.
  • Handle: RePEc:ifs:ifsewp:98/15
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    Cited by:

    1. Barbara Liberda, 1999. "Household Saving in Poland," CASE Network Studies and Analyses 0187, CASE-Center for Social and Economic Research.
    2. Orazio P. Attanasio & Miguel Székely, 1998. "Household Savings and Income Distribution in Mexico," IDB Publications (Working Papers) 1299, Inter-American Development Bank.
    3. Orazio P. Attanasio & Susann Rohwedder, 2003. "Pension Wealth and Household Saving: Evidence from Pension Reforms in the United Kingdom," American Economic Review, American Economic Association, vol. 93(5), pages 1499-1521, December.
    4. Orazio P. Attanasio & Miguel Székely, 1998. "Household Savings and Income Distribution in Mexico," Research Department Publications 4152, Inter-American Development Bank, Research Department.
    5. Orazio P. Attanasio & Miguel Székely, 1998. "El ahorro familiar y la distribución del ingreso en México," Research Department Publications 4153, Inter-American Development Bank, Research Department.
    6. Felix Freyland, 2005. "Household Composition and Savings: An Overview," MEA discussion paper series 05087, Munich Center for the Economics of Aging (MEA) at the Max Planck Institute for Social Law and Social Policy.
    7. Orazio Attanasio, 1997. "Consumption and saving behaviour: modelling recent trends," Fiscal Studies, Institute for Fiscal Studies, vol. 18(1), pages 23-47, February.
    8. Mariacristina Rossi, 2009. "Examining the Interaction between Saving and Contributions to Personal Pension Plans: Evidence from the BHPS," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 71(2), pages 253-271, April.
    9. John K Gibson & Grant M Scobie, 2001. "Household Saving Behaviour in New Zealand: A Cohort Analysis," Treasury Working Paper Series 01/18, New Zealand Treasury.
    10. Sònia Muñoz, 2006. "Wealth Effects in Europe; A Tale of Two Countries (Italy and the United Kingdom)," IMF Working Papers 06/30, International Monetary Fund.
    11. Grant M Scobie & John K Gibson, 2003. "Household Saving Behaviour in New Zealand: Why do Cohorts Behave Differently?," Treasury Working Paper Series 03/32, New Zealand Treasury.
    12. William Gale, 1997. "What can America learn from the British tax system?," Fiscal Studies, Institute for Fiscal Studies, vol. 18(4), pages 341-369, November.
    13. Huffman, David B. & Barenstein, Matias, 2004. "Riches to Rags Every Month? The Fall in Consumption Expenditures Between Paydays," IZA Discussion Papers 1430, Institute for the Study of Labor (IZA).
    14. Eva Sierminska & Thesia I. Garner, 2005. "A Comparison of Income, Expenditures, and Home Market Value Distributions Using Luxembourg Income Study Data from the 1990's," Working Papers 380, U.S. Bureau of Labor Statistics.
    15. Patricia Apps & Ray Rees, 2010. "Family labor supply, taxation and saving in an imperfect capital market," Review of Economics of the Household, Springer, vol. 8(3), pages 297-323, September.
    16. Apps, Patricia, 2003. "Gender, Time Use and Models of the Household," IZA Discussion Papers 796, Institute for the Study of Labor (IZA).
    17. Patricia Apps, 2010. "Why the Henry Review Fails on Family Tax Reform," CEPR Discussion Papers 642, Centre for Economic Policy Research, Research School of Economics, Australian National University.
    18. Garry Young, 2002. "The implications of an ageing population for the UK economy," Bank of England working papers 159, Bank of England.
    19. John Gibson & Grant Scobie, 2001. "A cohort analysis of household income, consumption and saving," New Zealand Economic Papers, Taylor & Francis Journals, vol. 35(2), pages 196-216.

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