The Anatomy of the Global Savings Glut

• Department of Economics
• Robert Schuman Centre for Advanced Studies

In this seminar Moritz Schularick (Sciences Po Paris and University of Bonn) will present his paper "The Anatomy of the Global Savings Glut."

This paper combines household-level data for the world's largest economies to study the increase in global savings and wealth since 1980. We calculate asset-specific savings flows and capital gains across the wealth distribution for the G3 economies -- the U.S., Europe, and China. We show that the increase in savings supply was primarily driven by higher savings in financial assets by the richest 10% of households in all three economies. The dominant force behind higher top-10% household savings was the secular rise of savings by corporations whose ultimate owners the rich households are: the ``corporate savings glut'' and the ``savings glut of the rich'' are two sides of the same coin. While savings flows played the key role for wealth accumulation of the top-10%, capital gains in housing have been the main source of wealth growth for middle class households. Without capital gains from risky assets and no meaningful savings flows, the wealth share of the bottom half of the population declined sharply in the G3 economies. 

Co-authors: Luis Bauluz and Filip Novokmet (Univeristy of Bonn) 

Due to limited spaces for COVID restrictions, participation on site will be allowed on a first-come, first-served basis. The event will also be live-streamed via zoom. Participants will receive the zoom link once registered.