The relationship between savings and economic growth at the disaggregated level

Nomvuyo Guma and Lumengo Bonga-Bonga

MPRA Paper from University Library of Munich, Germany

Abstract: While the literature, both international and in South Africa, is relatively rich in studies on the determinants of foreign direct investment as well as the determinants of savings, none of the work done on South Africa has made use of disaggregated savings data to understand whether there is an observable difference in the marginal propensity to save of the different economic sectors. Thus, this paper attempts to assess the marginal propensity to save by the household, corporate and government sectors in South Africa. The results of the econometric analysis demonstrate that the greatest responsiveness of savings to GDP growth occurs amongst corporates. These findings should inform the South African government on how to regulate sectoral taxation that intends to encourage savings, given the low level of savings in the country.

Keywords: savings; corporates; households; government; cointegration (search for similar items in EconPapers)
JEL-codes: C10 C13 E21 O40 (search for similar items in EconPapers)
Date: 2016-06-15
New Economics Papers: this item is included in nep-mac
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Related works:
Journal Article: THE RELATIONSHIP BETWEEN SAVINGS AND ECONOMIC GROWTH AT THE DISAGGREGATED LEVEL (2017)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:72131

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