Predicting minimum savings in Thai villages
Massachusetts Institute of Technology. Department of Economics.
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Amador Werning Angeletos (2006) characterize the conditions under which optimal saving/ consumption decision are determined by a minimum savings policy. I test this model empirically against data from the Townsend Thai Monthly Survey. Each household's income distribution, measure of risk aversion. and hyperbolic discount rate are estimated and then inputted into the model. In the overall sample., the minimum saving value as predicted by the model does register a statistically signficant relationship with the actual amount saved by the household. This is expected. since minimum saving policy is not optimal for all households. Limiting the sample to the appopriate subgroup produces a strong positive correlation.
Thesis: S.M., Massachusetts Institute of Technology, Department of Economics, 2015.Cataloged from PDF version of thesis.Includes bibliographical references (page 19).
DepartmentMassachusetts Institute of Technology. Department of Economics.
Massachusetts Institute of Technology