Iranian Household Saving Behavior

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Samaee, Kian | 2011

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Type of Document: M.Sc. Thesis
Language: Farsi
Document No: 42822 (44)
University: Sharif University of Technology
Department: Management and Economics
Advisor(s): Souri, Davood
Abstract:
This paper decomposes the saving rate into cohort, age and year effects. This objective is accomplished by constructing a pseudo-panel that amalgamates nineteen consecutive, cross-sectional Household Income and Expenditure Surveys from 1991 to 2009. To construct year-of-birth cohorts with consistent composition over time, analyses are limited to those born between 1926 and 1975. Results reveal that those belonging to younger cohorts save a higher fraction of their income relative to their predecessors at the same age. Moreover, the increase in the saving rate can not be explained by the significant decline in household size or rise in educational attainment among younger cohorts. Closer scrutiny reveals that all gaps between saving rate of younger and older cohorts can be explained by the increasing share of expenditures on durables in younger households’ budgets
Keywords:
Life Cycle Model ; Cohort Analysis ; Saving Behavior ; Deaton-paxon Decomposition ; Earning Life Cycle ; Consumption Life Cycle

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