Disentangling the importance of the precautionary saving mode
By: Arthur Kennickell, Annamaria Lusardi.
Contributors: Lusardi, Annamaria.; National Bureau of Economic Research.
Series: NBER working paper series ;; working paper 10888; Working paper series (National Bureau of Economic Research : Online) ;; working paper no. 10888.
Publisher: National Bureau of Economic Research
Published: 2004
Place of publication: Cambridge, MA
Language: eng
Format: Electronic resource
Subjects: Saving and investment -- Psychological aspects.
Description: "We assess the importance of the precautionary saving motive by relying on a direct question about precautionary wealth from the 1995 and 1998 waves of the Survey of Consumer Finances.  In this survey, a new question has been designed to elicit the amount of desired precautionary wealth.  This allows us to bound the amount of precautionary accumulation and to overcome many of the problems of previous works on this topic.  We find that a precautionary saving motive exists and affects virtually every type of household.  Even though this motive does not give rise to large amounts of wealth for young and middle-age households, it is particularly important for two groups: older households and business owners.  Overall, we provide strong evidence that we need to take the precautionary saving motive into account when modeling saving behavior"--National Bureau of Economic Research web site.
Notes: Includes bibliographical references.
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