This paper provides empirical evidence on the determinants of private saving in a sample of 49 developing countries over the period 1973-83. The evidence indicates that, as indicated by the theory, a positive relationship exists between the rate of growth of consumption and the expected real...

One of the important determinants of the response of saving and consumption to the real interest rate is the elasticity of intertemporal substitution. That elasticity can be measured by the response of the rate of change of consumption to changes in the expected real interest rate. A detailed...