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Save now, prosper later


  • Zuccollo, James

    (New Zealand Institute of Economic Research)

  • Ballingall, John

    (New Zealand Institute of Economic Research)


This paper uses NZIER’s dynamic Computable General Equilibrium (CGE) model of the New Zealand economy to conduct a preliminary investigation into how an increase in New Zealand’s national savings would affect New Zealand’s GDP and living standards. We do not specify how this increase might take place. We find that increased saving would reduce our overseas debt and thus cut our debt servicingrepayments. It is likely that the risk premium on borrowing costs would also fall under such a scenario. This would help boost investment.

Suggested Citation

  • Zuccollo, James & Ballingall, John, 2010. "Save now, prosper later," NZIER Working Paper 2010/2, New Zealand Institute of Economic Research.
  • Handle: RePEc:ris:nzierw:2010_002

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    References listed on IDEAS

    1. Peter B. Dixon, 2009. "Comments on the Productivity Commission's Modelling of the Economy-Wide Effects of Future Automotive Assistance," Economic Papers, The Economic Society of Australia, vol. 28(1), pages 11-18, March.
    2. William Coleman, 2008. "Gauging Economic Performance Under Changing Terms Of Trade: Real Gross Domestic Income Or Real Gross Domestic Product?," Economic Papers, The Economic Society of Australia, vol. 27(4), pages 329-342, December.
    3. Xiao-guang Zhang, 2006. "Armington Elasticities and Terms of Trade Effects in Global CGE Models," Staff Working Papers 0601, Productivity Commission, Government of Australia.
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    More about this item


    cge modelling; savings; New Zealand;

    JEL classification:

    • C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth


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