Title

Do the rich save more? A new view based on intergenerational transfers

Document Type

Journal article

Source Publication

Southern Economic Journal

Publication Date

10-1-2006

Volume

73

Issue

2

First Page

362

Last Page

373

Abstract

Do richer people have higher saving rates? The short-run and long-run consumption functions have different answers to this question, which results in the "consumption puzzle" that was a focus of macroeconomic research in the 1950s and 1960s. In a recent empirical contribution, Dynan, Skinner, and Zeldes (2004) revive this old question and make this "consumption puzzle" more intriguing, by showing that the average propensity to consume decreases not only with current income but also with lifetime income. This paper provides a model that helps resolve this puzzle from an intergenerational perspective.

DOI

10.2307/20111896

Print ISSN

00384038

E-ISSN

23258012

Publisher Statement

Copyright © 2006 Southern Economic Association

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Recommended Citation

Fan, C. S. (2006). Do the rich save more? A new view based on intergenerational transfers. Southern Economic Journal, 73(2), 362-373. doi: 10.2307/20111896