Does productivity growth boost savings? Causal evidence from transition episodes.
We introduce a novel approach to uncovering causation by exploiting transition episodes in aggregate macroeconomic data. Using a panel of 132 countries over 1961–2017, we identify twenty-six productivity-growth and forty savings transitions, episodes characterized by sudden, persistent, and unpredic...
| Published in: | Oxford Economic Papers Vol. 78; no. 2; pp. 511 - 540 |
|---|---|
| Main Authors: | , , |
| Format: | Article |
| Published: |
Oxford University Press / USA
Apr2026
|
| Subjects: | |
| Online Access: | View this record in EBSCOhost |
| fields | @attributes: recordID: 1 pdfLink: plink: https://search.ebscohost.com/login.aspx?direct=true&db=ssf&AN=194211917&site=ehost-live header: @attributes: shortDbName: ssf uiTerm: 194211917 longDbName: Social Sciences Full Text (H.W. Wilson) uiTag: AN controlInfo: bkinfo: jinfo: jid: 00307653 OXE jtl: Oxford Economic Papers issn: 00307653 maglogo: N pubinfo: dt: Apr2026 vid: 78 iid: 2 pid: 622 pub: Oxford University Press / USA artinfo: ui: 194211917 10.1093/oep/gpag006 ppf: 511 ppct: 29 formats: tig: atl: Does productivity growth boost savings? Causal evidence from transition episodes. aug: au: Kumar, Abhishek Mallick, Sushanta Sen, Kunal affil: University of Southampton, Southampton, SO17 1BJ, United KingdomCentre for Social and Economic Progress, New Delhi, India School of Business and Management, Queen Mary University of London, London, E1 4NS, United Kingdom UNU-WIDER, FinlandGlobal Development Institute, The University of Manchester, Manchester, M13 9PL, United Kingdom su: Macroeconomics Industrial productivity Economic expansion Panel analysis Causation (Philosophy) Causality (Physics) sug: subj: Macroeconomics Industrial productivity Economic expansion Panel analysis Causation (Philosophy) Causality (Physics) keyword: copyrightHolder:Oxford University Press copyrightYear:2026 counterfactual simulation event study inLanguage:en local projection productivity growth publisher:Oxford University Press sameAs:https://dx.doi.org/10.1093/oep/gpag006 savings copyrightHolder:Oxford University Press copyrightYear:2026 counterfactual simulation event study inLanguage:en local projection productivity growth publisher:Oxford University Press sameAs:https://dx.doi.org/10.1093/oep/gpag006 savings ab: We introduce a novel approach to uncovering causation by exploiting transition episodes in aggregate macroeconomic data. Using a panel of 132 countries over 1961–2017, we identify twenty-six productivity-growth and forty savings transitions, episodes characterized by sudden, persistent, and unpredictable increases in growth and savings. Event-study evidence shows that productivity-growth transitions lead to sustained increases in savings, whereas savings transitions do not generate sustained growth effects. We conduct extensive robustness checks addressing staggered transitions, heterogeneous effects, and unobserved time-varying confounders. Having established the direction of causality, we estimate the effects of productivity-growth and productivity shocks (estimated separately for each country using a neoclassical model) on savings using panel Vector Auto-Regressions and local projections. We find that a one standard deviation increase in productivity growth raises the savings ratio by approximately 0.5 percentage points, highlighting the importance of policies that promote productivity growth to increase savings, rather than relying solely on savings-focused interventions. pubtype: Academic Journal doctype: Article src: R language: English refInfo: copyright: @attributes: flag: N holdings: @attributes: islocal: N |
|---|