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How did COVID affect savings and wealth? An empirical study in South Africa

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Listed:
  • Amy Jansen

    (Faculty of Economics and Business, Department of Economics, Econometrics and Finance)

  • Robert Lensink

    (Faculty of Economics and Business, Department of Economics, Econometrics and Finance)

Abstract

By using a unique dataset of more than 20,000 individuals with savings accounts from August 2019 to October 2020 in South Africa, this paper examines how the COVID crisis has affected savings behavior, and by affecting savings, impacted wealth inequality. We find that while COVID increased savings on average, the increase in average savings is due to a small group of higher income savers which substantially increased their savings, while a large group stopped saving.

Suggested Citation

  • Amy Jansen & Robert Lensink, 2024. "How did COVID affect savings and wealth? An empirical study in South Africa," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 22(3), pages 757-780, September.
    • Handle: RePEc:spr:joecin:v:22:y:2024:i:3:d:10.1007_s10888-023-09613-6
    DOI: 10.1007/s10888-023-09613-6
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    References listed on IDEAS

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    4. Beatriz Armendáriz & Jonathan Morduch, 2010. "The Economics of Microfinance, Second Edition," MIT Press Books, The MIT Press, edition 2, volume 1, number 0262014106, December.
    5. Hayne E. Leland, 1968. "Saving and Uncertainty: The Precautionary Demand for Saving," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 82(3), pages 465-473.
    6. Lugilde, Alba & Bande, Roberto & Riveiro, Dolores, 2017. "Precautionary Saving: a review of the theory and the evidence," MPRA Paper 77511, University Library of Munich, Germany.
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