Private saving in India and Malaysia compared: The roles of financial liberalization and expected pension benefits

Beng Ang, Kunal Sen

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3 Citations (Scopus)


In this article, we provide a comparative account of the evolution of private saving in India and Malaysia, and analyze how policy changes in the financial sector and pension system help explain differences in their saving performance. Using the Autoregressive Distributed Lag (ARDL) bounds estimation procedure, we find a fairly robust long-run relationship between private saving and its determinants in both countries. Consistent with the predictions made in the life cycle model, our results indicate that higher income growth stimulates private saving and an increase in age dependency retards private saving. The results provide some support for the hypothesis that financial liberalization results in lower private saving in both countries. The evidence also indicates that expected pension benefits tend to stimulate private saving in India, but that the reverse is found in Malaysia.
Original languageEnglish
Pages (from-to)247 - 267
Number of pages21
JournalEmpirical Economics
Issue number2
Publication statusPublished - 2011

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