Research On The Changes In Japan’s Savings Rate And Effect

Savings are requisite in any economy，because it provides funds for families，businesses and the community. No savings will not be able to invest. Savings rate isone of the key factors which affect a country’s economic development.Japan has been one of the countries which have the highest savings rates in theworld. The continuous high savings rate promotes Japan’s rapid economic growthpostwar，and makes Japan to be remarkable in the world. At the same time，Japan’ssurplus savings help countries with a shortage of funds to address the funding gap，and high savings in Japan also contribute to the development of the world economy. Itcannot be neglected that high savings rate has also some negative impact on theJapanese economy，makes Japan to be troubled by the “savings glut”.However，the national savings rate in Japan rapidly declines from the1990’s，and Japan’s household savings rate declines more rapidly. The household savings ratedropped from18%in the early1980’s to3%now. Japan’s savings rate fell by15%ina quarter of the century. Compared with American families，some Japanese familiescan not make both ends meets. The depression of the Japanese economy isconcomitant with the decline of savings rate.Since1955，many factors make Japan’s savings rate change significantly.Changes in the savings rate in Japan will not only affect their own economies，butalso affect the world economy.The current situation is very similar to the situation in Japan before the1990’s，and both countries experienced high savings rate with high growth. China’s savingsrate has been high and rising. High savings rate provides a favorable financialsecurity for China’s rapid development，but also brings some negative impact onChina’s economy. Economic imbalances become increasingly prominent，such as low consumption，high investment，high exports，and so on.To seek a balanced and stable development of the economy by reducing thesavings rate will be a daunting task for China. This paper analyzes the causes andeffects of Japan’s savings rate changing from high to low since the1950’s through theuse of theoretical and empirical research and provides reference for China.This article consists of the following sections:The first chapter is introduction. It includes the background and significance ofthe topics，review of the literature about Japan’s savings rate，the main contents andresearch methods.The second chapter is the theoretical basis of this study. This chapter accuratelydefines the meaning of the savings and the savings rate and its classification，andsummarizes the theory of the decision and its economic effect on the savings rate.The third chapter studies the characteristics and the future trend of Japan’ssavings rate. This chapter first analyzes the characteristics of the overall operation ofJapan’s savings rate，observes changes in trend in household savings which is thelargest share of total savings，is consistent with total savings and empirical tests havea long-term equilibrium relationship between household savings rate and the totalsavings rate，the total change in the savings rate in large part because changes in thehousehold savings rate. This determines the main object of study of this article isJapan’s household savings rate. This chapter divides the changes of the householdsavings rate into three stages，and analyzes the changes’ characteristics，and thenmakes a more accurate position for the level of household savings rate in Japan bycalculating.The fourth chapter，the fifth chapter and the sixth chapter are the core contents ofthis article. Studying the causes and effects of the changes in the three stages of theJapan’s savings rate with the combination of theoretical and empirical methods.The fourth chapter analyzes the causes and effects of the rising savings rate from1955to1973， and teases out both the general causes and particular causes of the risein the savings rate，and then summarizes that how plenty of household savings inJapan play an important role in the economic development post-war，and studies the mechanism and channels to make Japanese savings into investment effectively.The fifth chapter studies the causes and effects of stability changes in savingsrate from1974to1990，and discusses that savings rate is affected by many factors toremain stable movements，and analyzes the positive and negative effects that the levelof savings have on Japan’s economic development. At last，making evaluation ofJapan’s excess savings’ purposes.The sixth chapter mainly studies the causes and impact of the decline in thesavings rate since1991. Income factors，demographic factors and the social securitysystem are the main causes of the decline in the savings rate. Finally，analyzing theeconomic effects of the decline in the savings rate from both positive and negative.The seventh chapter is the revelation of the changes in the savings rate in Japan.This chapter mainly analyzes the characteristics，impact and causes of China’ssavings rate，and then elaborates the ideas of adjusting china’s savings rate and somestrategies and countermeasures to reduce China’s high savings rate.