Working Paper: NBER ID: w17581
Authors: Charles Yuji Horioka; Akiko Terada-Hagiwara
Abstract: In this paper, we present data on trends over time in domestic saving rates in twelve economies in developing Asia during the 1966-2007 period and analyze the determinants of these trends. We find that domestic saving rates in developing Asia have, in general, been high and rising but that there have been substantial differences from economy to economy and that the main determinants of these trends appear to have been the age structure of the population (especially the aged dependency ratio), income levels, and the level of financial sector development. We then project future trends in domestic saving rates in developing Asia for the 2011-2030 period based on our estimation results and find that the domestic saving rate in developing Asia as a whole will remain roughly constant during the next two decades despite rapid population aging in some economies in developing Asia because population aging will occur much later in other economies and because the negative impact of population aging on the domestic saving rate will be largely offset by the positive impact of higher income levels.
Keywords: saving rates; developing Asia; demographic transition; financial sector development
JEL Codes: D91; E21; G10; J11
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| aged dependency ratio (J14) | saving rates (E43) |
| income levels (J31) | saving rates (E43) |
| financial sector development (O16) | saving rates (E43) |