Quotation Walther, Herbert, Stiassny, Alfred. 2008. International Comparisons of Household Saving Rates and Unobservable Income. Workshop OeNB: Saving in Austria - too little and too late?, Wien, Österreich, 24.10.2008.




In this paper it is argued that international comparisons of aggregate household saving rates are systematically distorted by unobservable variables. Different levels of shadow activities and of marketization of household activities are identified as the main culprits. Cross sectional data covering a period of a decade show that household saving rates are negatively related to female employment rates (used as an indicator of marketization) while they are positively related to the degree of corruption (used as an indicator of the propensity to shift economic activities into the underground). Furthermore, the ratio of income from property and self employment to wages is positively related to household saving rates across countries. The explanation for these closely related phenomena might be that unobserved ‘wages’ (equal to consumption) in the black labor market induce an upward bias of observed household saving rates and profit shares, while productivity levels are biased downwards. In addition, the level of redistributive activities and unobserved human capital investment of households should be considered as relevant factors for systematic distortions.


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Publication's profile

Status of publication Published
Affiliation WU
Type of publication Paper presented at an academic conference or symposium
Language English
Title International Comparisons of Household Saving Rates and Unobservable Income
Event Workshop OeNB: Saving in Austria - too little and too late?
Year 2008
Date 24.10.2008
Country Austria
Location Wien


Walther, Herbert (Former researcher)
Stiassny, Alfred (Details)
Institute for Quantitative Economics IN (Details)
Institute for Labor Economics IN (Details)
Research areas (ÖSTAT Classification 'Statistik Austria')
5335 Political economic theory (Details)
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