Wako Watanabe

Why Do People Save? A Micro‐Analysis of Motives for Household Saving in Japan

This paper estimates the contribution of net saving for each of twelve motives to overall household saving in Japan using micro data from a Japanese government survey and finds that net saving for the retirement and precautionary motives, both of which are consistent with the life-cycle model, are of dominant importance. It also finds that the saving motives of Japanese households vary greatly by age and that they save at each life stage for motives that are appropriate for that life stage. These findings suggest that the life-cycle model is highly applicable in the case of Japan. Copyright 1997 by Royal Economic Society.

Household saving in Japan

Recent research has indicated that Japanese and American saving behaviour may not be fundamentally different. In this paper we have tried to determine if aggregate saving in Japan, as in the United States, is driven by a small number of very wealthy or high‐income households. We found that about 12% of households account for 75% of total positive saving, 75% of total negative saving and 75% of total net saving. These conclusions reinforce the hypothesis that the savings process in Japan is not distinctive, and highlight the importance of research on the heterogeneity of saving behaviour. JEL Classification Numbers: D12, D31, E21.

Income Uncertainty and Self-Reported Precautionary Wealth: Evidence from the Japanese Micro Data

Using unique survey data which includes information on precautionary wealth and its target, we analyze the precautionary saving behavior of Japanese households. Our findings are: 1. Measures for income uncertainty have a positive influence on the target for precautionary wealth but not on precautionary wealth. 2. The positive influence of income uncertainty on the target vanishes when older households with a head aged 51 or older are included in the sample. These findings suggest that Japanese households save against income uncertainty until around when their head is aged 50 and then save against other risks such as the longevity risk.

Does the Policy Lending of the Government Financial Institution Mitigate the Credit Crunch? Evidence from the Loan Level Data in Japan

Using the contract level data, we find that the lending by Japan Finance Corporation for Small and Medium Enterprise (JASME), a state owned lending institution, mitigated a firm’s loss of borrowing from its main bank during the credit crunch. We further find that the JASME’s lending instrumented by the main bank’s lending supply growth as explained by the bank’s capital adequacy, which captures the lending to mitigate the loss of borrowing, had negative effects on the investment rate and that the JASME’s lending had an weak effect to mitigate the cash sensitivity of cash that captures the firm’s financial constraint.

Session 2: Finance to SMEs through Banks, Capital Markets, and Other Financial Methods

Good afternoon, ladies and gentlemen. My name is Suhaedi, Executive Director of Bank Indonesia Regional Office covering Sulawesi, Maluku, and the Papua Islands. Firstly, I would like to thank the Japanese FSA, ADBI, and the IMF for their invitation. It is a great pleasure and honor to chair this very important session, the focus of which is finance to SMEs, with prominent speakers and commentators. As you may be aware, the topics of finance to SMEs, as well as financial inclusion, have become popular topics and are discussed everywhere. It seems to me, this is a kind of paradox because of two things. SMEs have a significant role in economic development, both in the developed and the developing economies.