05530oam 22013094 450 991077922560332120230802005426.01-4755-1887-01-4755-7069-4(CKB)2550000000106446(EBL)1606753(SSID)ssj0000944116(PQKBManifestationID)11595730(PQKBTitleCode)TC0000944116(PQKBWorkID)10982532(PQKB)10754404(MiAaPQ)EBC1606753(Au-PeEL)EBL1606753(CaPaEBR)ebr10569530(OCoLC)870244916(IMF)WPIEE2012134(IMF)WPIEA2012134(EXLCZ)99255000000010644620020129d2012 uf 0engur|n|---|||||txtccrThe Volatility Trap : Precautionary Saving, Investment, and Aggregate Risk /Reda Cherif, Fuad HasanovWashington, D.C. :International Monetary Fund,2012.1 online resource (23 p.)IMF Working PapersDescription based upon print version of record.1-4755-9955-2 1-4755-0386-5 Includes bibliographical references.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 Statistics5. 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)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.IMF Working Papers; Working Paper ;No. 2012/134RiskSaving and investmentInvestments: CommoditiesimfExports and ImportsimfMacroeconomicsimfMacroeconomics: ConsumptionimfSavingimfWealthimfInvestmentimfCapitalimfIntangible CapitalimfCapacityimfIntertemporal Consumer ChoiceimfLife Cycle Models and SavingimfEconomic Growth and Aggregate Productivity: GeneralimfAggregate Factor Income DistributionimfCurrent Account AdjustmentimfShort-term Capital MovementsimfAgriculture: GeneralimfInternational economicsimfInvestment & securitiesimfPrecautionary savingsimfIncomeimfIncome shocksimfCurrent account surplusesimfAgricultural commoditiesimfNational accountsimfBalance of paymentsimfCommoditiesimfSaving and investmentimfFarm produceimfUnited StatesimfRisk.Saving and investment.Investments: CommoditiesExports and ImportsMacroeconomicsMacroeconomics: ConsumptionSavingWealthInvestmentCapitalIntangible CapitalCapacityIntertemporal Consumer ChoiceLife Cycle Models and SavingEconomic Growth and Aggregate Productivity: GeneralAggregate Factor Income DistributionCurrent Account AdjustmentShort-term Capital MovementsAgriculture: GeneralInternational economicsInvestment & securitiesPrecautionary savingsIncomeIncome shocksCurrent account surplusesAgricultural commoditiesNational accountsBalance of paymentsCommoditiesSaving and investmentFarm produceCherif Reda1485136Hasanov Fuad1472696International Monetary Fund.DcWaIMFBOOK9910779225603321The Volatility Trap3762941UNINA