The effect of precautionary saving on consumption in Sweden
2001 (English)In: Applied Economics, ISSN 0003-6846, E-ISSN 1466-4283, Vol. 33, no 5, 673-681 p.Article in journal (Refereed) Published
Uncertainty concerning future income lowers consumption. This is often called the precautionary demand for savings. In this paper the existence of precautionary savings. In this paper the existence of precautionary saving is investigated using Swedish data for the years 1973–1992. As there are no variables for consumers' uncertainty a proxy is used. Assuming an underlying distribution of attitudinal data, a variance series is derived. Including the proxy in different specifications of the consumption function, indication of precautionary saving can be found. As a result, no uncertainty would raise consumption by 4.9%.
Place, publisher, year, edition, pages
2001. Vol. 33, no 5, 673-681 p.
Probability Theory and Statistics
IdentifiersURN: urn:nbn:se:uu:diva-42767DOI: 10.1080/00036840122493ISI: 000167973200012OAI: oai:DiVA.org:uu-42767DiVA: diva2:70669