Brown, S. and Taylor, K.B. (2016) Early influences on saving behaviour: Analysis of British panel data. Journal of Banking and Finance, 62. pp. 1-14. ISSN 1872-6372
Abstract
Using data from the British Household Panel Survey and Understanding Society, we examine the saving behaviour of individuals over time. Initially, we explore the determinants of the saving behaviour of children aged 11–15. Our findings suggest that parental allowances/pocket money (earnings from part-time work) lower (increase) the probability that a child saves. There is also evidence that the financial expectations of the head of household have an influence on their offspring’s saving behaviour, where children of optimistic parents have a lower probability of saving by approximately 2 percentage points. However, there is no evidence of an intergenerational correlation in savings behaviour: the saving behaviour of parents appears to have no bearing on the saving decisions of their offspring. We then go on to explore the implications of the saving behaviour of children for their savings decisions in later life, specifically when observed in early adulthood. We find that having saved as a child has a large positive influence both on the probability of saving on a monthly basis and on the amount saved as an adult. This finding is robust to alternative empirical strategies including IV analysis where the most conservative estimates show that having saved as a child increases the probability of saving during adulthood by 12 percentage points.
Metadata
Item Type: | Article |
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Authors/Creators: |
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Copyright, Publisher and Additional Information: | �© 2015 The Authors. Published by Elsevier B.V. This is an open access article under the CC BY license (http://creativecommons.org/licenses/by/4.0/). |
Keywords: | Household finances; Panel data; Saving |
Dates: |
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Institution: | The University of Sheffield |
Academic Units: | The University of Sheffield > Faculty of Social Sciences (Sheffield) > Department of Economics (Sheffield) |
Depositing User: | Symplectic Sheffield |
Date Deposited: | 09 Nov 2015 12:09 |
Last Modified: | 09 Nov 2015 12:09 |
Published Version: | http://dx.doi.org/10.1016/j.jbankfin.2015.09.011 |
Status: | Published |
Publisher: | Elsevier |
Refereed: | Yes |
Identification Number: | 10.1016/j.jbankfin.2015.09.011 |
Open Archives Initiative ID (OAI ID): | oai:eprints.whiterose.ac.uk:91592 |