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OECD Economic Outlook
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Table 23 Household saving rates
Table 24 Gross national saving
Annex Table 23 - Household saving rate
Definition: Household saving is defined as household disposable income less consumption. Household income consists primarily of the compensation of employees, self-employment income, and transfers. Property and other income - essentially dividends and interest - are evaluated in the light of business income and debt interest flows. The sum of these elements is adjusted for direct taxes and transfers paid to give household disposable income. The latter is then split between household consumption and saving. SNA93/ESA95 has changed the concept of disposable income for households (compared with SNA68/ESA79) so as to include private pension benefits and subtract private pension contributions:
Disposable income (new) = Disposable income (old) + private pension benefits - contributions
This new treatment of disposable income is not consistent with another SNA notion, namely that assets of private pension funds is actually owned by the household sector. In order to reconcile the new disposable income concept with the correct saving concept (where private private pension benefits and contributions should have no influence on the magnitude of saving) it is necessary to adjust saving by adding back contributions and subtract benefits. This means that the definition of saving is unchanged:
Saving = Disposable income (new) - private pension benefits + contributions - consumption
= Disposable income (old) - consumption
The adjustment made to savings under SNA93 rules (i.e. contributions-benefits) is equal to the change in net equity of households in pension funds. For further information, see paragraphs 9.14-9.16 in the SNA93 Manual. Since the definition of saving is unaffected by differences in national accounts practices, this is not a source of inconsistency across countries. As regards the saving ratios, these are comparable as long as the same disposable income concept is used in the denominator. Currently, 12 OECD countries follow SNA93 rules and report the adjustment term: Germany, the United Kingdom, Finland, Belgium, Netherlands, Norway, Denmark, Sweden, Japan, Korea, Italy and Spain. The rest of OECD countries, including the United States and Canada, have chosen not to include contributions to and benefits from private pension funds in household income, hence their disposable income concept has not changed to follow the SNA93 rules. However, this has no consequences for the definition of saving, cf. above. For Spain, the household saving ratio was estimated by the OECD on the basis of employees' compensation and consumption data from the new national accounts (base 2000), while other components were taken from the previous system due to their unavailability in the new system. (See Boissinot and Catte, forthcoming Working Paper).
Related links: National Accounts, The 1993 System of National Accounts, Glossary and The United Nations Technical note on National Accounts
Last updated: 20 February 2006
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Annex Table 24 - Gross national saving
Definition:Gross national income less consumption (private and public).
Sources: National Accounts and The 1993 System of National Accounts, Glossary
Last updated: 20 February 2006
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