Have IRAs Increased U.S. Saving?: Evidence from Consumer Expenditure Surveys
The vast majority of Individual Retirement Account contributions represent net new saving, based on evidence from the quarterly Consumer Expenditure Surveys (CES). The results are based on analysis of the relationship between IRA contributions and other financial asset saving. The data show almost no substitution of IRAs for other saving. While the core of the paper is based on cross-section analysis, important use is made of the CES panel of independent cross-sections that span the period during which IRAs were introduced. Estimates for the post 1982 period, when IRAs were available to all employees, are based on a flexible constrained optimization model, with the IRA limit the principle constraint. The implications of this model for saving in the absence of the IRA option match very closely the actual non-IRA financial asset saving behavior prior to 1982. IRA saving does not show up as other financial asset saving in the pre-IRA period.
|Date of creation:||Apr 1987|
|Date of revision:|
|Publication status:||published as Quarterly Journal of Economics, Vol. 105, pp. 661-698, August 1990.|
|Contact details of provider:|| Postal: |
Web page: http://www.nber.org
More information through EDIRC
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.:
- B. Douglas Bernheim & John B. Shoven, 1985.
"Pension Funding and Saving,"
NBER Working Papers
1622, National Bureau of Economic Research, Inc.
- Diamond, P. A. & Hausman, J. A., 1984. "Individual retirement and savings behavior," Journal of Public Economics, Elsevier, vol. 23(1-2), pages 81-114.
- Kotlikoff, Laurence J, 1984.
"Taxation and Savings: A Neoclassical Perspective,"
Journal of Economic Literature,
American Economic Association, vol. 22(4), pages 1576-1629, December.
- Zvi Bodie & John B. Shoven, 1983. "Financial Aspects of the United States Pension System," NBER Books, National Bureau of Economic Research, Inc, number bodi83-1, October.
- Venti, Steven F & Wise, David A, 1986. "Tax-Deferred Accounts, Constrained Choice and Estimation of Individual Saving," Review of Economic Studies, Wiley Blackwell, vol. 53(4), pages 579-601, August.
- Steven F. Venti & David A. Wise, 1986.
"IRAs and Saving,"
NBER Working Papers
1879, National Bureau of Economic Research, Inc.
- Michael D. Hurd & John B. Shoven, 1982.
"The Economic Status of the Elderly,"
NBER Working Papers
0914, National Bureau of Economic Research, Inc.
- Steven F. Venti & David A. Wise, 1988.
"The Determinants of IRA Contributions and the Effect of Limit Changes,"
in: Pensions in the U.S. Economy, pages 9-52
National Bureau of Economic Research, Inc.
- Steven F. Venti & David A. Wise, 1985. "The Determinants of IRA Contributions and the Effect of Limit Changes," NBER Working Papers 1731, National Bureau of Economic Research, Inc.
- Deaton, Angus & Meullbauer, John, 1981. "Functional Forms for Labor Supply and Commodity Demands with and without Quantity Restrictions," Econometrica, Econometric Society, vol. 49(6), pages 1521-32, November.
- Zvi Bodie & John B. Shoven & David A. Wise, 1988. "Pensions in the U.S. Economy," NBER Books, National Bureau of Economic Research, Inc, number bodi88-1, October.
- Mervyn A. King & Jonathan I. Leape, 1984. "Wealth and Portfolio Composition: Theory and Evidence," NBER Working Papers 1468, National Bureau of Economic Research, Inc.
- Lawrence H. Summers, 1985. "Issues in National Savings Policy," NBER Working Papers 1710, National Bureau of Economic Research, Inc.
When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:2217. 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: ()
If references are entirely missing, you can add them using this form.