Why are Saving Rates so High in China?

48 Pages Posted: 14 Feb 2011  

Dennis Tao Yang

Chinese University of Hong Kong - Department of Economics

Junsen Zhang

The Chinese University of Hong Kong (CUHK) - Department of Economics; IZA Institute of Labor Economics

Shaojie Zhou

Tsinghua University

Multiple version iconThere are 3 versions of this paper

Date Written: February 2011

Abstract

In this paper, we define "The Chinese Saving Puzzle" as the persistently high national saving rate at 34-53 percent of gross domestic product (GDP) in the past three decades and a surge in the saving rate by 11 percentage points from 2000-2008. Using data from the Flow of Funds Accounts (FFA) and Urban Household Surveys (UHS) supplemented by the findings from existing studies, we analyze the sources and causes of China's high and rising saving rates in the government, corporate, and household sectors. Although the causes of China's high saving are complex, we suggest that the evolving economic, demographic, and policy trends in the internal and external environments of the Chinese economy will likely lead to a decline in national saving in the foreseeable future.

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Suggested Citation

Yang, Dennis Tao and Zhang, Junsen and Zhou, Shaojie, Why are Saving Rates so High in China? (February 2011). NBER Working Paper Series, Vol. w16771, pp. -, 2011. Available at SSRN: https://ssrn.com/abstract=1759843

Dennis Tao Yang (Contact Author)

Chinese University of Hong Kong - Department of Economics ( email )

Shatin N.T.
Hong Kong
Hong Kong

Junsen Zhang

The Chinese University of Hong Kong (CUHK) - Department of Economics ( email )

Shatin, N.T.
Hong Kong
852-2609-8186 (Phone)
852-2603-5805 (Fax)

HOME PAGE: http://www.cuhk.edu.hk/eco/staff/jszhang/jzhang.htm

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Shaojie Zhou

Tsinghua University ( email )

Beijing, 100084
China

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