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Börsch-Supan, Axel H.; Reil-Held, Anette; Rodepeter, Ralf; Schnabel, Reinhold; Winter, Joachim (2000): Household Savings in Germany. Discussion papers / Institut für Volkswirtschaftslehre und Statistik ; Department of Economics, Universität Mannheim, 577
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This paper describes how German households save, and how their saving behavior is linked to public policy, notably pension policy. Our analysis is based on a synthetic panel of four cross sections of the German Income and Expenditure Survey (\"Einkommens- und Verbrauchsstichproben,\" EVS), 1978, 1983, 1988 and 1993. The paper carefully distinguishes among several saving measures and concepts. It separates discretionary savings from mandatory savings, and uses two flow measures, namely first the sum of purchases of assets minus the sum of sales of assets, and second the residual of income minus consumption. Our main finding is a hump-shaped age-saving profile. However, savings remain positive in old age, even for most low income households. The generous mandatory German public pension system is a prime candidate to explain this pattern.