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Title: |
Why Did Koreans Save So "Little" and Why Do
They Now Save So "Much?" |
| Author: |
Kang, Kenneth
H. |
| Author
Affiliation: |
Harvard U |
| Source: |
International Economic Journal, Winter 1994, v. 8, no. 4, pp. 99-111 |
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Publication Date: |
Winter 1994 |
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Abstract: |
This paper uses a variable rate-of-growth
model of life-cycle saving as developed by Fry and Mason (1982) to show
that demographic factors were behind the rapid rise in saving in Japan,
Korea, and Taiwan. The steady decline in the population dependency ratio
in an environment of rapid economic growth was the determining factor
driving the trend rise in savings in these three countries. Furthermore,
demographic trends can also explain the difference in saving ratios in
Japan, Korea, and Taiwan. When one compares these countries at the same
stage in their development, Koreans did save "little" relative to Japan,
but not relative to Taiwan, and this difference in saving can be
explained by Korea's higher rate of dependency. |
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