Household Saving in the United States: Measurement and Behavior

Abstract

Official measures of U.S. personal saving incorporate conceptual errors relating to the measurement of both income and consumption. This article identifies the errors, computes an adjusted personal saving rate to correct the errors, and estimates equations explaining personal saving. The estimates support the adjustments, and the adjusted series has more pronounced movements than the official series, the movements being largely related to changes in income and wealth.

KEY WORDS:

• Conceptual adjustments
• Inflation
• Saving-wealth relation