How prudent are rural households in developing transition economies
Rural households in developing economies frequently use precautionary saving to cope with income risk. Such prudent behavior can be strengthened in transition economies where more risks are typically faced by households during and after reforms. This paper uses a rich panel of rural households in Zh...
| Autores principales: | , , , |
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| Formato: | Artículo preliminar |
| Lenguaje: | Inglés |
| Publicado: |
International Food Policy Research Institute
2011
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| Materias: | |
| Acceso en línea: | https://hdl.handle.net/10568/154501 |
| _version_ | 1855533909936177152 |
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| author | Jin, Ling Chen, Kevin Z. Yu, Bingxin Huang, Zuhui |
| author_browse | Chen, Kevin Z. Huang, Zuhui Jin, Ling Yu, Bingxin |
| author_facet | Jin, Ling Chen, Kevin Z. Yu, Bingxin Huang, Zuhui |
| author_sort | Jin, Ling |
| collection | Repository of Agricultural Research Outputs (CGSpace) |
| description | Rural households in developing economies frequently use precautionary saving to cope with income risk. Such prudent behavior can be strengthened in transition economies where more risks are typically faced by households during and after reforms. This paper uses a rich panel of rural households in Zhejiang, China, to examine the correlation between income uncertainty and the target ratio of wealth to permanent income as suggested by the buffer-stock model. The empirical results suggest that Chinese rural households hold a significant level of wealth to mitigate the adverse impacts of income risk. Simulation results show that an increase in income risk leads to a sharp increase in household wealth and precautionary saving could drop substantially if income risk is eliminated. The high level of prudence of rural households under economic transition can help us better understand the developments in China, which will have policy implications for both developing and transition countries. |
| format | Artículo preliminar |
| id | CGSpace154501 |
| institution | CGIAR Consortium |
| language | Inglés |
| publishDate | 2011 |
| publishDateRange | 2011 |
| publishDateSort | 2011 |
| publisher | International Food Policy Research Institute |
| publisherStr | International Food Policy Research Institute |
| record_format | dspace |
| spelling | CGSpace1545012025-11-06T07:06:58Z How prudent are rural households in developing transition economies Jin, Ling Chen, Kevin Z. Yu, Bingxin Huang, Zuhui models savings households Rural households in developing economies frequently use precautionary saving to cope with income risk. Such prudent behavior can be strengthened in transition economies where more risks are typically faced by households during and after reforms. This paper uses a rich panel of rural households in Zhejiang, China, to examine the correlation between income uncertainty and the target ratio of wealth to permanent income as suggested by the buffer-stock model. The empirical results suggest that Chinese rural households hold a significant level of wealth to mitigate the adverse impacts of income risk. Simulation results show that an increase in income risk leads to a sharp increase in household wealth and precautionary saving could drop substantially if income risk is eliminated. The high level of prudence of rural households under economic transition can help us better understand the developments in China, which will have policy implications for both developing and transition countries. 2011 2024-10-01T14:01:55Z 2024-10-01T14:01:55Z Working Paper https://hdl.handle.net/10568/154501 en https://hdl.handle.net/10568/154296 https://hdl.handle.net/10568/154771 Open Access application/pdf International Food Policy Research Institute Jin, Ling; Chen, Kevin Z.; Yu, Bingxin; Huang, Zuhui. 2011. How prudent are rural households in developing transition economies. IFPRI Discussion Paper 1127. https://hdl.handle.net/10568/154501 |
| spellingShingle | models savings households Jin, Ling Chen, Kevin Z. Yu, Bingxin Huang, Zuhui How prudent are rural households in developing transition economies |
| title | How prudent are rural households in developing transition economies |
| title_full | How prudent are rural households in developing transition economies |
| title_fullStr | How prudent are rural households in developing transition economies |
| title_full_unstemmed | How prudent are rural households in developing transition economies |
| title_short | How prudent are rural households in developing transition economies |
| title_sort | how prudent are rural households in developing transition economies |
| topic | models savings households |
| url | https://hdl.handle.net/10568/154501 |
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