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Record Nr. |
UNINA9910779225603321 |
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Autore |
Cherif Reda |
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Titolo |
The Volatility Trap : : Precautionary Saving, Investment, and Aggregate Risk / / Reda Cherif, Fuad Hasanov |
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Pubbl/distr/stampa |
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Washington, D.C. : , : International Monetary Fund, , 2012 |
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ISBN |
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1-4755-1887-0 |
1-4755-7069-4 |
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Descrizione fisica |
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1 online resource (23 p.) |
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Collana |
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Altri autori (Persone) |
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Soggetti |
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Risk |
Saving and investment |
Investments: Commodities |
Exports and Imports |
Macroeconomics |
Macroeconomics: Consumption |
Saving |
Wealth |
Investment |
Capital |
Intangible Capital |
Capacity |
Intertemporal Consumer Choice |
Life Cycle Models and Saving |
Economic Growth and Aggregate Productivity: General |
Aggregate Factor Income Distribution |
Current Account Adjustment |
Short-term Capital Movements |
Agriculture: General |
International economics |
Investment & securities |
Precautionary savings |
Income |
Income shocks |
Current account surpluses |
Agricultural commodities |
National accounts |
Balance of payments |
Commodities |
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Farm produce |
United States |
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Lingua di pubblicazione |
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Formato |
Materiale a stampa |
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Livello bibliografico |
Monografia |
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Note generali |
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Description based upon print version of record. |
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Nota di bibliografia |
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Includes bibliographical references. |
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Nota di contenuto |
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Cover; Abstract; Contents; Introduction; II. A "Store-or-Sow" Model of Precautionary Saving and Investment; III. Results and Implications; Figures; 1. Precautionary Saving and the Golden Rule Investment Rate; 2. A Phase Diagram of Precautionary Saving and Investment Rates; 3. Precautionary Saving and Investment Rates vs. Volatility of Permanent Shocks; 4. Precautionary Saving and Investment Rates vs. Volatility of Temporary Shocks; IV. An Empirical Relationship Among Investment, Saving, and Volatility; Tables; 1. Saving, Investment, and Volatility: Descriptive Statistics |
5. Saving vs. Investment6. Saving vs. Investment-Saving Ratio; V. Concluding Remarks; 2. Panel Fixed Effects Regressions; References; Appendix Table. Average Investment, Saving, and Volatility (1970-2008) |
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Sommario/riassunto |
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We study the effects of permanent and temporary income shocks on precautionary saving and investment in a "store-or-sow" model of growth. High volatility of permanent shocks results in high precautionary saving in the safe asset and low investment, or a "volatility trap." Namely, big savers invest relatively little. In contrast, low volatility of permanent shocks leads to low precautionary saving and high or low investment, depending on the volatility of temporary shocks. Empirical evidence shows a nonlinear relationship between investment and saving and that investment is a hump-shaped function of the volatility of permanent shocks, as predicted by the model. |
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