On Some Determinants of Saving in Developed and Under-Developed Countries

  • H. S. Houthakker
Part of the International Economic Association Series book series (IEA)


For the analysis of economic development, the principal question concerning savings is whether or not savings increase more than proportionately to income. In virtually all theories of growth, capital formation plays some part, and it is therefore important to know how it can be financed. The question is crucial for those theories — now somewhat discredited — which regard capital formation as the primary means of raising income levels, because suitable variations in the savings-income ratio are then needed to explain why some countries stay poor in the absence of foreign investment. Theories of the latter variety would be left hanging in mid-air if the savings-income ratio did not vary significantly among countries or in the long run.


National Income Personal Income Private Saving Domestic Saving Direct Taxis 
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Copyright information

© International Economic Association 1965

Authors and Affiliations

  • H. S. Houthakker
    • 1
  1. 1.Harvard UniversityUSA

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