Household Saving Motives: Comparing American and Chinese Consumers

Abstract

Using the 2008 Survey of Chinese Consumer Finance and Investor Education and the 2007 Survey of Consumer Finances, this study compared saving motives between Chinese and American urban households. Results showed that Chinese households were more likely than American households to report precautionary and education saving motives, and Chinese households with lower incomes were more likely to report a retirement saving motive. Chinese households’ stronger motivation to save serves as an explanation of the greater saving rates in China, compared with the United States. The results have implications for policy makers, financial professionals, and consumer finance researchers.