CFDP 1974

Wealth Effects on World Private Financial Saving

Publication Date: December 2014

Pages: 29

Abstract: 

This paper shows that about 70 percent of the variance of the yearly change in the world private financial saving rate can be explained by lagged changes in world stock and housing prices for the sample period 1982-2013. The results suggest that increased fluctuations in asset prices since 1995 have led to increased fluctuations in the world private financial saving rate. Wealth effects on private demand appear to be large.

Keywords: 

Financial saving, World economy, Wealth effects

JEL Classification Codes:  E21, E44, F41