The Decline in Household Saving and the Wealth Effect
By Joseph P. Lupton, James P. Smith, F. Stafford, F. Juster. Review of Economics and Statistics, 2004
211 citations recorded by the source corpus.
Using a unique set of household-level panel data, we estimate the effect of capital gains on saving by asset type, controlling for observable and unobservable household-specific fixed effects. The results suggest that the decline in the personal saving rate since 1984 is largely due to the significant capital gains in corporate equities experienced over this period. Over 5-year periods, the effect of capital gains in corporate equities on saving is substantially larger than the effect of capital gains in housing or other assets. Failure to differentiate wealth effects across asset types results in a significant understatement of their size.
Subfields: Accounting, Economics and Econometrics
View Paper: https://www.semanticscholar.org/paper/fa11f484254391af2917d146cd4c5e1763fd570c
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Citations in the corpus
- Credit constraints and growth in a global economy (2012, background): “9 The decline in the US saving rate has been attributed to positive wealth effects (Poterba 2000; Juster et al. 2006; Carroll, Otsuka, and Slacalek 2011); financial innovation and relaxation of borrowing constraints (Parker 2000; Boz and Mendoza 2014; and Ferrero 2012); changes in social security an”
- Housing wealth, financial wealth, and consumption: New evidence from micro data (2009, unknown): “28 Juster et al. (2006) estimate the effect of capital gains on saving by asset type.”
- Do the Rich Save More? (2004, unknown): “…the value of assets less debt brought into the household plus the value of assets less debt taken out of the household—and then modify it, following Juster et al. (2001), to correct for inflation and to account for likely reporting error in whether a family moved.22 The saving rate is computed…”
- Intertemporal Consumption and Credit Constraints: Does Total Expenditure Respond to an Exogenous Shock to Credit? (2010, background): “Juster et al. (2006) find no evidence that capital gains in housing influence savings decisions.”