X hits on this document

PDF document

Euro area/United States/Japan1 - page 3 / 8

22 views

0 shares

0 downloads

0 comments

3 / 8

















Chart 2. Net household saving ratios standard definition

 

 



 













  

changed. Three factors are discussed below: (1) household consumption of public services; (2) income tax versus taxes on production; and (3) social security schemes versus private pension schemes.

Household consumption of public services

The extent to which the government or the individual pays for services such as education and health varies considerably between countries. On the assumption that government provision of services used by specific households is financed by income taxes from those households, household saving will not be directly affected by these differences between countries, although household saving ratios will be. This effect may be illustrated by considering two hypothetical situations for the same country. In the first scenario no services are provided by the government to specific households. In the second scenario the government provides free health and education services, and finances these by increasing income taxes from households. Consequently, in the second scenario both household disposable income and household final consumption expenditure will be lower than in the first scenario, while household saving will be

  • 

    unaffected. Therefore, the household saving ratio will be

Sources: OECD, National Accounts of OECD Countries database, 2004; National statistical agencies

possible explanations for these differences are analysed in the next section.

Possible causes for differences of the standardised household saving ratio

The differences in legal and administrative arrangements between countries can result in different household saving ratios even if the underlying economic behaviour of households in those countries is equivalent. Therefore it is of interest for the purposes of such a comparative analysis to quantify the impact of those institutional differences. At the outset, however, it should be made clear that the ‘hypothetical’ adjustments below lead to figures that deviate from the institutional reality in the areas concerned. Besides, they can only provide “first- order” approximation for the effect of institutional differences between countries, because in reality the economic behaviour of households would be affected if the institutional arrangements in a country actually

Euro area

United States

Japan

1991

-2.1

-0.6

-1.4

1992

-2.1

-0.6

-1.4

1993

-2.1

-0.5

-1.4

1994

-2.0

-0.4

-1.3

1995

-1.9

-0.4

-1.3

1996

-1.9

-0.3

-1.1

1997

-1.8

-0.3

-1.1

1998

-1.6

-0.3

-1.2

1999

-1.4

-0.2

-1.2

2000

-1.4

-0.2

-1.1

2001

-1.5

-0.1

-0.7

2002

-1.5

-0.2

-0.7

Table 1. Changes from standardised household saving ratios: household consumption of public services (percentage points)

Sources: OECD, National Accounts of OECD Countries database, 2004 and national statistical agencies

3

Document info
Document views22
Page views22
Page last viewedSun Dec 11 04:41:48 UTC 2016
Pages8
Paragraphs340
Words3782

Comments