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Charles Yuji Horioka - One of the best experts on this subject based on the ideXlab platform.
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Is the Selfish Life-Cycle Model More Applicable in Japan and, If So, Why? A Literature Survey
2020Co-Authors: Charles Yuji HoriokaAbstract:The selfish life-cycle model or hypothesis is, together with the dynasty or altruism model, the most widely used theoretical model of Household behavior in economics, but does this model apply in the case of a country like Japan, which is said to have closer family ties than other countries? In this paper, we first provide a brief exposition of the simplest version of the selfish life-cycle model and then survey the literature on Household Saving and bequest behavior in Japan in order to answer this question. The paper finds that almost all of the available evidence suggests that the selfish life-cycle model applies to at least some extent in all countries but that there is more consistent support for this model in Japan than in the United States and other countries. It then explores possible explanations for why the life-cycle model is more consistently supported in Japan than in other countries, attributing this finding to government policies, institutional factors, economic factors, demographic factors, and cultural factors. Finally, it shows that the findings of the paper have many important implications for economic modeling and for government tax and expenditure policies
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the impact of sex ratios before marriage on Household Saving in two asian countries the competitive Saving motive revisited
Review of Economics of the Household, 2017Co-Authors: Charles Yuji Horioka, Akiko TeradahagiwaraAbstract:This paper estimates a Household Saving rate equation for India and Korea using long-term time series data for the 1975–2010 period, focusing in particular on the impact of the pre-marital sex ratio on the Household Saving rate. To summarize the main findings of the paper, it finds that the pre-marital sex (or gender) ratio (the ratio of males to females) has a significant impact on the Household Saving rate in both India and Korea, even after controlling for the usual suspects such as the aged and youth dependency ratios and income. It has a negative impact in India, where the bride’s side has to pay substantial dowries to the groom’s side at marriage, but a positive impact in Korea, where, as in China, the groom’s side has to bear a disproportionate share of marriage-related expenses including purchasing a house or condominium for the newlywed couple.
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the impact of sex ratios before marriage on Household Saving in two asian countries the competitive Saving motive revisited
Social Science Research Network, 2016Co-Authors: Charles Yuji Horioka, Akiko TeradahagiwaraAbstract:This paper estimates a Household Saving rate equation for India and the Republic of Korea using long-term time series data for the 1975–2010 period, focusing in particular on the impact of the premarital sex ratio on the Household Saving rate. To summarize the main findings of the paper, it finds that the premarital sex (or gender) ratio (the ratio of males to females) has a significant impact on the Household Saving rate in both India and the Republic of Korea, even after controlling for the usual suspects such as the aged and youth dependency ratios and income. It has a negative impact in India, where the bride’s side has to pay substantial dowries to the groom’s side at marriage, but a positive impact in the Republic of Korea, where, as in the People’s Republic of China, the groom’s side has to bear a disproportionate share of marriage-related expenses including purchasing a house or condominium for the newlywed couple.
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the flow of Household funds in japan
Public Policy Review, 2008Co-Authors: Charles Yuji HoriokaAbstract:In this paper, I consider why Japan's Household Saving rate was so high in the past and why it has shown a downward trend in more recent years, and based on this analysis, I project future trends in Japan's Household Saving rate. To preview my main findings, I find, first, that Japan's Household Saving rate used to be high but that it has declined sharply in recent years and that it is no longer high in either absolute or relative terms. Moreover, Japan's Household Saving rate will continue its decline due to the rapid aging of her population and other factors and may well become zero or negative within a few years. However, the government's fiscal deficits (government disSaving) as well as corporate investment in plant and equipment can be expected to decline at the same time, and moreover, there is always the option of borrowing from abroad, so the sharp decline in the Household Saving rate will not necessarily cause any problems.
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the determinants of Household Saving in china a dynamic panel analysis of provincial data
Journal of Money Credit and Banking, 2007Co-Authors: Charles Yuji HoriokaAbstract:In this paper, we conduct a dynamic panel analysis of the determinants of the Household Saving rate in China using a life cycle model and panel data on Chinese provinces for the 1995-2004 period from China?s Household survey. We find that China?s Household Saving rate has been high and rising and that the main determinants of variations over time and over space therein are the lagged Saving rate, the income growth rate, (in many cases) the real interest rate, and (in some cases) the inflation rate. However, we find that the variables relating to the age structure of the population have the expected impact on the Household Saving rate in only one of the four samples. These results provide mixed support for the life cycle hypothesis as well as the permanent income hypothesis, are consistent with the existence of inertia or persistence, and imply that China?s Household Saving rate will remain high for some time to come.
Nelson C Mark - One of the best experts on this subject based on the ideXlab platform.
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demographics and aggregate Household Saving in japan china and india
Journal of Macroeconomics, 2017Co-Authors: Chadwick C Curtis, Steven Lugauer, Nelson C MarkAbstract:Abstract We use a model of Household life-cycle Saving decisions to quantify the impact of demographic changes on aggregate Household Saving rates in Japan, China, and India. The observed age distributions help explain the contrasting Saving patterns over time across the three countries. In the model simulations, the growing number of retirees suppresses Japanese Saving rates, while decreasing family size increases Saving for both China and India. Projecting forward, the model predicts a decline in Household Saving rates in Japan and China.
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demographics and aggregate Household Saving in japan china and india
Research Papers in Economics, 2015Co-Authors: Chadwick C Curtis, Steven Lugauer, Nelson C MarkAbstract:We present a model of Household life-cycle Saving decisions in order to quantify the impact of demographic changes on aggregate Household Saving rates in Japan, China, and India. The observed age distributions help explain the contrasting Saving patterns over time across the three countries. In the model simulations, the growing number of retirees suppresses Japanese Saving rates, while decreasing family size increases Saving for both China and India. Projecting forward, the model predicts lower Household Saving rates in Japan and China.
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demographics and aggregate Household Saving in japan china and india
Social Science Research Network, 2015Co-Authors: Chadwick C Curtis, Steven Lugauer, Nelson C MarkAbstract:We present a model of Household life-cycle Saving decisions in order to quantify the impact of demographic changes on aggregate Household Saving rates in Japan, China, and India. The observed age distributions help explain the contrasting Saving patterns over time across the three countries. In the model simulations, the growing number of retirees suppresses Japanese Saving rates, while decreasing family size increases Saving for both China and India. Projecting forward, the model predicts lower Household Saving rates in Japan and China.Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.
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demographic patterns and Household Saving in china
American Economic Journal: Macroeconomics, 2015Co-Authors: Chadwick C Curtis, Steven Lugauer, Nelson C MarkAbstract:AbstractThis paper studies the effect that changing demographic patterns have had on the house-hold Saving rate in China. We undertake a quantitative investigation using an overlappinggenerations (OLG) model where agents live for 85 years. Consumers begin to exercise deci-sion making when they are 18. From age 18 to 60, they work and raise children. Dependentchildren’s utility enter into parent’s utility where parents choose the consumption level of theyoung until they leave the Household. Working agents give a portion of their labor income totheir retired parents and save for their own retirement while the aged live on their accumulatedassets and support from their children. Remaining assets are bequeathed to the living upondeath. We parameterize the model and take future demographic changes, labor income andinterest rates as exogenously given from the data. We then run the model from 1963 to 2009and find that the model accounts for nearly all the observed increase in the Household Savingrate.Keywords: Saving, Life-Cycle, China, Demographics, Overlapping GenerationsJEL: E2, J1
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demographic patterns and Household Saving in china
Social Science Research Network, 2011Co-Authors: Chadwick C Curtis, Steven Lugauer, Nelson C MarkAbstract:This paper studies the effect that changing demographic patterns have had on the Household Saving rate in China. We undertake a quantitative investigation using an overlapping generations (OLG) model where agents live for 85 years. Consumers begin to exercise decision making when they are 18. From age 18 to 60, they work and raise children. Dependent children's utility enter into parent's utility where parents choose the consumption level of the young until they leave the Household. Working agents give a portion of their labor income to their retired parents and save for their own retirement while the aged live on their accumulated assets and support from their children. Remaining assets are bequeathed to the living upon death. We parameterize the model and take future demographic changes, labor income and interest rates as exogenously given from the data. We then run the model from 1963 to 2009 and find that the model accounts for nearly all the observed increase in the Household Saving rate.
Ilja Kristian Kavonius - One of the best experts on this subject based on the ideXlab platform.
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measuring the stock of consumer durables and its implications for euro area Savings ratios
Review of Income and Wealth, 2009Co-Authors: Jukka Jalava, Ilja Kristian KavoniusAbstract:The purpose of this article is to estimate the impact of capitalizing durable goods on the euro area Household Saving ratios and disposable incomes for the first time. The reason for this exercise is twofold. Firstly, it is generally accepted that individual Households regard consumer durables as assets even though they are not treated as such in the System of National Accounts 1993. Secondly, the issue is related to the definition of Household Saving ratios. For instance, the U.S. Federal Reserve Board publishes three Household Saving measures. The main difference between these Saving ratios is that one is derived by treating expenditure on consumer durables as investments while the other two are compiled by considering them to be Household final consumption expenditure. We find that the effect of capitalizing consumer durables on EA Saving ratios is moderate. The impact is lower than it is in the U.S.
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durable goods and their effect on Household Saving ratios in the euro area
2007Co-Authors: Jukka Jalava, Ilja Kristian KavoniusAbstract:The purpose of this paper is to estimate the impact of capitalising durable goods on the Euro area Household Saving ratios and disposable incomes for the first time. The reason for this exercise is twofold. Firstly, it is generally accepted that individual Households regard consumer durables as assets even though they are not treated as such in the System of National Accounts 1993. Secondly, the issue is related to the definition of Household Saving ratios. For instance, the U.S. Federal Reserve Board publishes three Household Saving measures. The main difference between these Saving ratios is that one is derived by treating expenditure on consumer durables as investments while the other ones are compiled by considering them to be Household final consumption expenditure. We find that the effect of capitalising consumer durables on EA Saving ratios is moderate. The impact is lower than it is in the US. JEL Classification: E21, E22
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durable goods and their effect on Household Saving ratios in the euro area
Social Science Research Network, 2007Co-Authors: Jukka Jalava, Ilja Kristian KavoniusAbstract:The purpose of this paper is to estimate the impact of capitalising durable goods on the Euro area Household Saving ratios and disposable incomes for the first time. The reason for this exercise is twofold. Firstly, it is generally accepted that individual Households regard consumer durables as assets even though they are not treated as such in the System of National Accounts 1993. Secondly, the issue is related to the definition of Household Saving ratios. For instance, the U.S. Federal Reserve Board publishes three Household Saving measures. The main difference between these Saving ratios is that one is derived by treating expenditure on consumer durables as investments while the other ones are compiled by considering them to be Household final consumption expenditure. We find that the effect of capitalising consumer durables on EA Saving ratios is moderate. The impact is lower than it is in the US.
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durable goods and Household Saving ratios in the euro area
2006Co-Authors: Jukka Jalava, Ilja Kristian KavoniusAbstract:The purpose of this paper is to estimate the impact of capitalising durable goods on the Euro area (EA) countries' and the EA-aggregate's Household Saving ratios and disposable incomes. The reason for this exercise is twofold. Firstly, it is generally accepted that individual Households regard consumer durables as assets even though they are not treated as such in the System of National Accounts 1993. Secondly, the issue is related to the definition of Household Saving ratios; a much discussed topic in previous years. For instance, the U.S. Federal Reserve Board publishes two separate Household net Saving measures. The difference between these Saving ratios is that one is derived by treating expenditure on consumer durables as investments while the other one is compiled by considering them to be Household final consumption expenditure as is the present convention. We find that the effect of capitalising consumer durables on EA Saving ratios is significant although the impact is lower than it is in the US.
Tri Achya Ngasuko - One of the best experts on this subject based on the ideXlab platform.
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faktor yang mempengaruhi rumah tangga untuk mengakses lembaga keuangan formal studi kasus susenas 2015 determinant factor for Household to access formal financial institution the study case susenas 2015
MPRA Paper, 2018Co-Authors: Tri Achya NgasukoAbstract:The World Bank in 2014 reports only 36% of Indonesia's population has access to the formal financial institution. This number shows us the level of financial inclusion in Indonesia. There is still some task to do since Indonesian government has the goals 70% level of financial inclusion in 2019. A survey from BPS, namely Susenas 2015, has the brand new information about the profile of Household Saving which not available in the previous Susenas survey. This study is the first one which examines determinant factors that deter families from access to formal financial services, mainly Saving based on Susenas 2015. The results of the study provide the Household profile and identify determinant factors for Households to access formal financial institution to make a Saving account. By employs multinomial logit method, the probabilities for a Household to obtain Saving in the formal institution is affected by the demographic characteristics such as age, total family members, youth and old dependent member in the Household. Education, employment, and field sector of head Household, as well as credit status and location of the head of Household as a determinant factor for the head of Household to open Saving account in the formal financial institution. The findings of this study are vital in providing policy recommendation to increase the level of financial inclusion in Indonesia.
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faktor yang mempengaruhi rumah tangga untuk mengakses lembaga keuangan formal studi kasus susenas 2015 determinant factor for Household to access formal financial institution the study case susenas 2015
MPRA Paper, 2018Co-Authors: Tri Achya NgasukoAbstract:The World Bank in 2014 reports only 36% of Indonesia's population has access to the formal financial institution. This number shows us the level of financial inclusion in Indonesia. There is still some task to do since Indonesian government has the goals 70% level of financial inclusion in 2019. A survey from BPS, namely Susenas 2015, has the brand new information about the profile of Household Saving which not available in the previous Susenas survey. This study is the first one which examines determinant factors that deter families from access to formal financial services, mainly Saving based on Susenas 2015. The results of the study provide the Household profile and identify determinant factors for Households to access formal financial institution to make a Saving account. By employs multinomial logit method, the probabilities for a Household to obtain Saving in the formal institution is affected by the demographic characteristics such as age, total family members, youth and old dependent member in the Household. Education, employment, and field sector of head Household, as well as credit status and location of the head of Household as a determinant factor for the head of Household to open Saving account in the formal financial institution. The findings of this study are vital in providing policy recommendation to increase the level of financial inclusion in Indonesia.
Annamaria Lusardi - One of the best experts on this subject based on the ideXlab platform.
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Household Saving behavior the role of financial literacy information and financial education programs
National Bureau of Economic Research, 2008Co-Authors: Annamaria LusardiAbstract:Individuals are increasingly in charge of their own financial security after retirement. But how well-equipped are individuals to make Saving decisions; do they possess adequate financial literacy, are they informed about the most important components of Saving plans, do they even plan for retirement? This paper shows that financial illiteracy is widespread among the U.S. population and particularly acute among specific demographic groups, such as those with low education, women, African-Americans, and Hispanics. Moreover, close to half of older workers do not know which type of pensions they have and the large majority of workers know little about the rules governing Social Security benefits. Notwithstanding the low levels of literacy that many individuals display, very few rely on the help of experts or financial advisors to make Saving and investment decisions. Low literacy and lack of information affect the ability to save and to secure a comfortable retirement; ignorance about basic financial concepts can be linked to lack of retirement planning and lack of wealth. Financial education programs can help improve Saving and financial decision-making, but much more can be done to improve the effectiveness of these programs.
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Household Saving behavior the role of literacy information and financial education programs
National Bureau of Economic Research, 2007Co-Authors: Annamaria LusardiAbstract:Individuals are increasingly in charge of their own financial security after retirement. But how well-equipped are individuals to make Saving decisions; do they possess adequate financial literacy, are they informed about the most important components of Saving plans, do they even plan for retirement? This paper shows that financial illiteracy is widespread among the US population and particularly acute among specific demographic groups, such as those with low education, women, African-Americans and Hispanics. Moreover, close to half of older workers do not know which type of pensions they have and the large majority of workers know little about the rules governing Social Security benefits. Lack of literacy and lack of information can affect the ability to save and to secure a comfortable retirement; few individuals rely on the help of financial advisors and ignorance about basic financial concepts can be linked to lack of retirement planning and lack of wealth. Financial education programs can help improve Saving and financial decision-making, but much more can be done to improve the effectiveness of these programs.
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Household Saving: Micro Theories and Micro Facts
Journal of Economic Literature, 1996Co-Authors: Martin Browning, Annamaria LusardiAbstract:In this survey, we review the recent theoretical and empirical literature on Household Saving and consumption. The discussion is structured around a list of motives for Saving and how well the standard theory captures these motives. We show that almost all of the motives for Saving that have been suggested in the informal Saving literature can be captured in the standard optimizing model. Particular attention is given to recent work on the precautionary motive and its implications for Saving and consumption behavior. We also discuss the "behavioral" or "psychological" approach that eschews the use of standard optimization techniques and focuses instead on direct consideration on Saving. We provide a section on facts: who save and how much. We then discuss informally the recent decline in the U.S. Saving rate and whether the theory is of much use in understanding this and other changes in aggregate Saving rates over time. We do not find any convincing explanation for the change in Saving rates. We also discuss some analyses of Saving behavior over the life-cycle, addressing such questions as whether Households save "enough" for retirement and whether the consumption patterns of older Households can be rationalized within a simple life cycle model. We also review a great number of studies of the consumption Euler equations. Based on our analysis of the studies cited we conclude that there is still mixed evidence that consumption is excessively sensitive to income. We also examine in depth the recent empirical literature on the precautionary motive. We conclude that although some Households do seem to have a significant precautionary motive at some points in their life cycle, this motive is not so strong empirically as some investigators suggest.