Microeconomic Evidence on the Composition of Effective Household Savingsduring the 1960s and 1970s

Abstract

This paper studies the impact of broad changes in the economic and financial environment on the savings rate and portfolio composition of individuals in different age groups and household types. Employing survey data, household savings are cumulated as increases in net transactable wealth observed across three benchmark dates: January-February 1962, the first half of 1970, and August-September,1911. This paper describes how savings rates and the allocation of accumulated savings across different financial and real-estate assets varied with household circumstances. A sharp turn-around is observed between the 1960s and 1970s in the profiles of saving and homeownership for younger and older households.