A time-series approach to the determination of savings rates

Research output: Contribution to journalArticle

Abstract

Time series analysis is used to study the savings rate and its determinants. The real effective exchange rate is introduced as a new independent variable in the savings function. Borrowing constraints, the current account balance, real rate of interest, macroeconomic stability, and age dependency are shown to be significant determinants of the savings rate. In addition, the real effective exchange rate is found to be significant across countries. Violations of Purchasing Power Parity are shown to explain some of the differences in savings rates between Canada, Japan, the United Kingdom and the United States.

Original languageEnglish (US)
Pages (from-to)147-159
Number of pages13
JournalInternational Economic Journal
Volume18
Issue number2
DOIs
StatePublished - Jan 1 2004
Externally publishedYes

Keywords

  • purchasing power parity
  • Savings
  • time-series

ASJC Scopus subject areas

  • Economics, Econometrics and Finance(all)

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