Risks, Financing Constraints, and High Savings Ratio in the Rural Economy of China: A Model Incorporating Precautionary Savings and Liquidity Constraints

in Frontiers of Economics in China
Restricted Access
Get Access to Full Text
Rent on DeepDyve

Have an Access Token?



Enter your access token to activate and access content online.

Please login and go to your personal user account to enter your access token.



Help

Have Institutional Access?



Access content through your institution. Any other coaching guidance?



Connect

This paper makes an in-depth investigation on the phenomenon of high savings rate in the rural economy of China between 1978 and 2003. On the basis of precautionary savings theory, we construct a model incorporating the risks, liquidity constrains, and aging population to explain the existence of high savings rate in the rural economy of China. We measure risks with Gini coefficient and marginal propensity to save. We find that these risk indices are positively associated with the higher savings rate and the higher degree of prudence of rural households. Our findings pose an urgency of the reform of rural financial system and the improvement in social security system in the rural economy of China.

Risks, Financing Constraints, and High Savings Ratio in the Rural Economy of China: A Model Incorporating Precautionary Savings and Liquidity Constraints

in Frontiers of Economics in China

Information

Content Metrics

Content Metrics

All Time Past Year Past 30 Days
Abstract Views 12 12 5
Full Text Views 25 25 5
PDF Downloads 4 4 2
EPUB Downloads 0 0 0