IDEAS home Printed from https://ideas.repec.org/p/nbr/nberwo/1710.html
   My bibliography  Save this paper

Issues in National Savings Policy

Author

Listed:
  • Lawrence H. Summers

Abstract

This paper reviews a number of issues relating to the policy goal of increasing national savings. The first section considers the measurement and definition of national savings. Comparisons of current US savings rates with those of other countries and with the past US experience are presented. The second section considers possible avenues through which public policy can increase natianal savings. While most discussion has centered on the effects of changes in the rate of return received by savers, this is far from the only channel through which policy can effect savings. I conclude that changes in public savings or dissaving through budget surpluses or deficits are the most potent and reliable policy tool for altering the saving rate. The third section of the paper examines a crucial savings policy question. Where will extra savings go? Both empirical estimates and econometric model simulations suggest will find their way into increased plant and equipment investment. A major effect of increased savings would be to reduce capital inflows and improve American competitiveness.

Suggested Citation

  • Lawrence H. Summers, 1985. "Issues in National Savings Policy," NBER Working Papers 1710, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:1710
    Note: PE EFG
    as

    Download full text from publisher

    File URL: http://www.nber.org/papers/w1710.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Feldstein, Martin & Horioka, Charles, 1980. "Domestic Saving and International Capital Flows," Economic Journal, Royal Economic Society, vol. 90(358), pages 314-329, June.
    2. Summers, Lawrence H, 1981. "Capital Taxation and Accumulation in a Life Cycle Growth Model," American Economic Review, American Economic Association, vol. 71(4), pages 533-544, September.
    3. Kotlikoff, Laurence J & Summers, Lawrence H, 1981. "The Role of Intergenerational Transfers in Aggregate Capital Accumulation," Journal of Political Economy, University of Chicago Press, vol. 89(4), pages 706-732, August.
    4. N. Gregory Mankiw & Lawrence H. Summers, 1984. "Are Tax Cuts Really Expansionary?," NBER Working Papers 1443, National Bureau of Economic Research, Inc.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. B. Douglas Bernheim & John Karl Scholz, 1993. "Private Saving and Public Policy," NBER Chapters, in: Tax Policy and the Economy, Volume 7, pages 73-110, National Bureau of Economic Research, Inc.
    2. Steven F. Venti & David A. Wise, 1990. "Have IRAs Increased U. S. Saving?: Evidence from Consumer Expenditure Surveys," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 105(3), pages 661-698.
    3. Kerttula, Anne, 1989. "Capital income taxation and household saving," Research Discussion Papers 29/1989, Bank of Finland.
    4. Lawrence H. Summers, 1986. "Debt problems and macroeconomic policies," Proceedings - Economic Policy Symposium - Jackson Hole, Federal Reserve Bank of Kansas City, pages 165-208.
    5. David F. Bradford, 1989. "Market Value Vs. Financial Accounting Measures of National Saving," NBER Working Papers 2906, National Bureau of Economic Research, Inc.
    6. repec:idb:brikps:377 is not listed on IDEAS
    7. van Wijnbergen, Sweder, 1988. "Monopolistic competition, credibility and the output costs of disinflation programs An analysis of price controls," Journal of Development Economics, Elsevier, vol. 29(3), pages 375-398, November.
    8. repec:zbw:bofrdp:1989_029 is not listed on IDEAS
    9. Michael J. Boskin, 1987. "Future Social Security Financing Alternatives and National Saving," NBER Working Papers 2256, National Bureau of Economic Research, Inc.
    10. Anand Chandavarkar, 1993. "Saving Behaviour in the Asian‐Pacific Region," Asian-Pacific Economic Literature, The Crawford School, The Australian National University, vol. 7(1), pages 9-27, May.
    11. Michael J. Boskin, 1987. "Concepts and Measures of Federal Deficits and Debt and Their Impact on Economic Activity," NBER Working Papers 2332, National Bureau of Economic Research, Inc.
    12. Corbo, Vittorio & Fischer, Stanley, 1991. "Adjustment programs and Bank support : rationale and main results," Policy Research Working Paper Series 582, The World Bank.
    13. Kerttula, Anne, 1989. "Capital income taxation and household saving," Bank of Finland Research Discussion Papers 29/1989, Bank of Finland.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Elmendorf, Douglas W. & Gregory Mankiw, N., 1999. "Government debt," Handbook of Macroeconomics, in: J. B. Taylor & M. Woodford (ed.), Handbook of Macroeconomics, edition 1, volume 1, chapter 25, pages 1615-1669, Elsevier.
    2. Holger Zemanek, 2010. "Competitiveness Within The Euro Area: The Problem That Still Needs To Be Solved," Economic Affairs, Wiley Blackwell, vol. 30(3), pages 42-47, October.
    3. Laurence J. Kotlikoff & Lawrence H. Summers, 1986. "The Contribution of Intergenerational Transfers to Total Wealth: A Reply," NBER Working Papers 1827, National Bureau of Economic Research, Inc.
    4. Raymond G. Batina, 1999. "A Differential Incidence Analysis of a Tax Reform From an Income Tax to a Consumption Tax in the Presence of Bequests," Public Finance Review, , vol. 27(3), pages 353-370, May.
    5. Finn Marten Körner & Holger Zemanek, 2013. "On the Brink? Intra-euro Area Imbalances and the Sustainability of Foreign Debt," Review of International Economics, Wiley Blackwell, vol. 21(1), pages 18-34, February.
    6. R. Glenn Hubbard, 1984. "'Precautionary' Saving Revisited: Social Security, Individual Welfare, and the Capital Stock," NBER Working Papers 1430, National Bureau of Economic Research, Inc.
    7. Rivas, Luis A., 2003. "Income taxes, spending composition and long-run growth," European Economic Review, Elsevier, vol. 47(3), pages 477-503, June.
    8. Jack M. Mintz, 2001. "Taxing Future Consumption," The State of Economics in Canada: Festschrift in Honour of David Slater, in: Patrick Grady & Andrew Sharpe (ed.),The State of Economics in Canada: Festschrift in Honour of David Slater, pages 79-94, Centre for the Study of Living Standards.
    9. Noam Gruber, 2023. "A relative answer to the growth–saving puzzle," International Finance, Wiley Blackwell, vol. 26(2), pages 139-171, August.
    10. Simon Gilchrist & Fabio M. Natalucci & Egon Zakrajsek, 2007. "Investment and the Cost of Capital: New Evidence from the Corporate Bond Market," Boston University - Department of Economics - Working Papers Series WP2007-027, Boston University - Department of Economics.
    11. Douglas W. Elmendorf, "undated". "The Effect of Interest-Rate Changes on Household Saving and Consumption: A Survey," Finance and Economics Discussion Series 1996-27, Board of Governors of the Federal Reserve System (U.S.), revised 10 Dec 2019.
    12. Bernheim, B. Douglas, 2002. "Taxation and saving," Handbook of Public Economics, in: A. J. Auerbach & M. Feldstein (ed.), Handbook of Public Economics, edition 1, volume 3, chapter 18, pages 1173-1249, Elsevier.
    13. Summers, Lawrence H, 1984. "The After-Tax Rate of Return Affects Private Savings," American Economic Review, American Economic Association, vol. 74(2), pages 249-253, May.
    14. Zodrow, George R. & Diamond, John W., 2013. "Dynamic Overlapping Generations Computable General Equilibrium Models and the Analysis of Tax Policy: The Diamond–Zodrow Model," Handbook of Computable General Equilibrium Modeling, in: Peter B. Dixon & Dale Jorgenson (ed.), Handbook of Computable General Equilibrium Modeling, edition 1, volume 1, chapter 0, pages 743-813, Elsevier.
    15. Feldstein, Martin, 1995. "Fiscal policies, capital formation, and capitalism," European Economic Review, Elsevier, vol. 39(3-4), pages 399-420, April.
    16. R. Glenn Hubbard & Kenneth L. Judd, 1985. "Social Security and Individual Welfare: Precautionary Saving, LiquidityConstraints, and the Payroll Tax," NBER Working Papers 1736, National Bureau of Economic Research, Inc.
    17. Hubbard, R. Glenn & Skinner, Jonathan & Zeldes, Stephen P., 1994. "The importance of precautionary motives in explaining individual and aggregate saving," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 40(1), pages 59-125, June.
    18. Joel Slemrod, 1982. "Down-Payment Constraints: Tax Policy Effects in a Growing Economy With Rental and Owner-Occupied Housing," Public Finance Review, , vol. 10(2), pages 193-217, April.
    19. Alicia H. Munnell, 1992. "Taxation of capital income in a global economy: an overview," New England Economic Review, Federal Reserve Bank of Boston, issue Sep, pages 33-52.
    20. Taylor, Alan M., 1998. "Argentina and the world capital market: saving, investment, and international capital mobility in the twentieth century," Journal of Development Economics, Elsevier, vol. 57(1), pages 147-184, October.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:1710. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/nberrus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.