Determinants of household saving: Cointegrated evidence from Pakistan (1975–2011)

Aisha Ismail and Kashif Rashid

Economic Modelling, 2013, vol. 32, issue C, 524-531

Abstract: The purpose of this study is two-fold: firstly, to analyze the long run relationship between household saving and various socio-economic and demographic variables and secondly, to determine the short run and the long run impact of various socio-economic and demographic variables on the household saving rate in Pakistan. The relationship between household saving and various socio-economic and demographic variables is analyzed by applying Johansen cointegration analysis. Furthermore, Error Correction Model is also estimated in order to find out the convergence of the model towards equilibrium. The results show that there exists a long run relationship between household saving and the variables used in the study, while the result of Error Correction Model reveals that about 45% convergence towards equilibrium takes place every year.

Keywords: Household saving; Cointegration; Error Correction Model; Pakistan (search for similar items in EconPapers)
JEL-codes: C22 D11 D12 (search for similar items in EconPapers)
Date: 2013
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecmode:v:32:y:2013:i:c:p:524-531

DOI: 10.1016/j.econmod.2013.02.004

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