Incomeలో Consumption చేయకుండా మిగిలిన భాగాన్ని Saving – పొదుపు అంటారు. Consumption మరియు Saving ఒకదానితో ఒకటి నేరుగా సంబంధం కలిగిన ముఖ్యమైన macroeconomic concepts.
Income = Consumption + Saving
Y = C + S
Disposable incomeలో consumption expenditureకు ఉపయోగించకుండా మిగిలిన భాగాన్ని Saving అంటారు.
ఇక్కడ:
Y = Income
C = Consumption
Income = ₹10,000
Consumption = ₹8,000
= 10,000 − 8,000
Saving = ₹2,000
Saving మరియు Income మధ్య functional relationshipను Saving Function అంటారు.
Consumption function:
Y = C + S కాబట్టి:
S = Y − (a + bY)
S = Y − a − bY
−a = Autonomous Dissaving
1 − b = Marginal Propensity to Save (MPS)
Income zero అయినప్పుడు consumption functionలో autonomous consumption ఉన్నట్లయితే saving negativeగా ఉంటుంది.
S = −a
దీనిని simple Keynesian modelలో Autonomous Dissavingగా అర్థం చేసుకోవచ్చు.
C = 100 + 0.8Y అయితే,
Y = 0 వద్ద C = 100
S = 0 − 100
S = −100
| Condition | Relationship | Result |
|---|---|---|
| Consumption < Income | C < Y | Positive Saving |
| Consumption = Income | C = Y | Zero Saving |
| Consumption > Income | C > Y | Dissaving / Negative Saving |
Dissaving అంటే saving చేయకపోవడం మాత్రమే కాదు.
It means Saving is negative: S < 0.
Total Incomeలో ఎంత proportion save చేస్తున్నారో Average Propensity to Save తెలియజేస్తుంది.
Income = ₹1,000
Saving = ₹200
APS = 0.2
అంటే incomeలో 20% saving అవుతోంది.
Incomeలో వచ్చిన additional changeలో ఎంత proportion savingకు వెళుతుందో Marginal Propensity to Save తెలియజేస్తుంది.
Income ₹1,000 నుంచి ₹1,500కు పెరిగింది.
Saving ₹200 నుంచి ₹300కు పెరిగింది.
ΔS = ₹100
MPS = 100 / 500
MPS = 0.2
| APS | MPS |
|---|---|
| Average Propensity to Save | Marginal Propensity to Save |
| S / Y | ΔS / ΔY |
| Total saving relative to total income | Change in saving relative to change in income |
Income:
Yతో divide చేస్తే:
Incomeలో వచ్చిన change consumption మరియు saving మధ్య విభజించబడుతుంది.
ΔYతో divide చేస్తే:
MPC = 1 − MPS
Average + Average: APC + APS = 1
Marginal + Marginal: MPC + MPS = 1
Suppose consumption function:
Then:
| Income (Y) | Consumption (C) | Saving (S) |
|---|---|---|
| 0 | 100 | −100 |
| 100 | 180 | −80 |
| 200 | 260 | −60 |
| 300 | 340 | −40 |
| 400 | 420 | −20 |
| 500 | 500 | 0 |
| 600 | 580 | 20 |
| 800 | 740 | 60 |
| 1000 | 900 | 100 |
Saving curve vertical-axis intercept = −a
Saving curve slope = MPS
Saving curve X-axisను cross చేసే point = Break-Even Income
Break-even point వద్ద income మొత్తం consumptionకు ఉపయోగించబడుతుంది. Saving zero.
Saving function:
Break-even వద్ద S = 0.
a = (1−b)Y
Since MPS = 1−b:
C = 200 + 0.75Y
MPC = 0.75
MPS = 0.25
Break-Even Income
= 200 / 0.25
= ₹800
Savingను income మాత్రమే కాకుండా అనేక economic మరియు behavioural factors ప్రభావితం చేస్తాయి.
Income పెరిగినప్పుడు consumption అవసరాలు తీర్చిన తరువాత saving చేయగల capacity సాధారణంగా పెరుగుతుంది.
Interest rate saving decisionsపై ప్రభావం చూపవచ్చు. Higher return on financial saving కొన్ని సందర్భాల్లో householdsను ఎక్కువ saving చేయడానికి ప్రోత్సహించవచ్చు.
Future income, employment లేదా economic uncertainty గురించి expectations saving behaviourను ప్రభావితం చేస్తాయి.
Future emergencies, illness, unemployment లేదా unexpected expenditure కోసం households precautionary saving చేయవచ్చు.
Taxes disposable incomeను ప్రభావితం చేస్తాయి. Disposable incomeలో మార్పు consumption మరియు saving రెండింటినీ ప్రభావితం చేయవచ్చు.
Existing wealth level household saving behaviourను ప్రభావితం చేయవచ్చు.
Inflation real purchasing power మరియు financial returnsను ప్రభావితం చేయడం ద్వారా saving patternను మార్చవచ్చు.
Easy credit availability current consumptionను support చేయడం వల్ల current saving behaviourపై ప్రభావం చూపవచ్చు.
Age, family size, dependency ratio, retirement needs మరియు social security arrangements saving decisionsపై ప్రభావం చూపుతాయి.
✓ Emergency / precaution
✓ Education
✓ Marriage and family needs
✓ Purchase of assets
✓ Retirement
✓ Financial security
✓ Business purposes
✓ Wealth accumulation
Macroeconomicsలో Saving మరియు Investmentకు ముఖ్యమైన సంబంధం ఉంది.
Simple closed economy without governmentలో national-income accounting identity ప్రకారం:
Individual household saving మరియు individual firm's investment ఒకే activity కావు.
Saving → Income not consumed
Investment → Addition to productive capital / inventories in macroeconomic usage.
Ex-Ante అంటే planned or intended.
Ex-Ante Investment → Planned Investment
Planned saving మరియు planned investment తప్పనిసరిగా ప్రతి income level వద్ద equal కావాల్సిన అవసరం లేదు.
Ex-Post అంటే actually realised.
Ex-Post Investment → Actual Investment
Saving గురించి అత్యంత ముఖ్యమైన Keynesian conceptsలో Paradox of Thrift ఒకటి.
ఒక individual ఎక్కువగా save చేయడం అతనికి beneficial కావచ్చు. కానీ economyలో అందరూ ఒకేసారి consumptionను తగ్గించి ఎక్కువ save చేయడానికి ప్రయత్నిస్తే aggregate demand తగ్గవచ్చు.
↓
Consumption ↓
↓
Aggregate Demand ↓
↓
Output / Income ↓
↓
Employment may ↓
↓
Actual aggregate saving may fail to rise as intended
What may be desirable for one individual need not produce the same result when everyone does it simultaneously.
Individual Virtue → May become a Macro Problem
This is the essence of the Paradox of Thrift.
Saving can provide resources for investment through the financial system. Productive investment can expand capital formation and future productive capacity.
↓
Financial Intermediation
↓
Investment
↓
Capital Formation
↓
Potential Output / Growth
Higher saving by itself does not automatically guarantee higher investment or growth. Financial intermediation, investment demand, institutions and productive opportunities also matter.
Macroeconomic analysis may distinguish saving according to the institutional sector doing the saving.
| Type | Broad Meaning |
|---|---|
| Household / Personal Saving | Saving by households |
| Corporate Saving | Retained saving of corporate enterprises |
| Private Saving | Broadly household + private corporate saving |
| Government / Public Saving | Saving generated by government sector under the relevant national-accounting definition |
| National Saving | Aggregate domestic saving across institutional sectors |
Given:
Find Saving Function.
S = Y − (300 + 0.6Y)
S = Y − 300 − 0.6Y
S = −300 + 0.4Y
MPS = 0.4
| Concept | Formula |
|---|---|
| Income | Y = C + S |
| Saving | S = Y − C |
| Consumption Function | C = a + bY |
| Saving Function | S = −a + (1−b)Y |
| APC | C/Y |
| APS | S/Y |
| MPC | ΔC/ΔY |
| MPS | ΔS/ΔY |
| APC + APS | 1 |
| MPC + MPS | 1 |
| Break-Even Income | a/(1−b) = a/MPS |
| Simple Multiplier | 1/MPS = 1/(1−MPC) |
A) Y + C
B) Y − C
C) C − Y always
D) Y × C
A) Y = C + S
B) Y = C − S
C) Y = C × S
D) Y = S/C
A) ΔS/ΔY
B) S/Y
C) C/Y
D) ΔC/ΔY
A) S/Y
B) ΔS/ΔY
C) C/Y
D) ΔC/ΔS
A) 0
B) 1
C) 2
D) 100
A) 0
B) 1
C) −1
D) 2
A) 0.2
B) 0.3
C) 0.7
D) 1.7
A) 0.15
B) 0.85
C) 1.15
D) 1.85
A) APC
B) MPC
C) MPS
D) APS
A) S > 0
B) S = 0
C) S < 0 always
D) Y = 0
A) C = Y
B) C > Y
C) C = 0
D) C < Y necessarily
A) Positive Saving
B) Dissaving
C) Zero Saving
D) MPS = 1
A) C > Y
B) C = Y
C) C < Y
D) Y = 0
A) S = a + bY
B) S = −a + (1−b)Y
C) S = a − bY
D) S = Y + C
A) MPC
B) Autonomous Dissaving
C) Investment
D) Income
A) Keynesian economics
B) Marshall's demand law only
C) Ricardo's rent only
D) Fisher's quantity equation only
A) Aggregate demand may fall
B) Aggregate demand must rise
C) Income must remain unchanged
D) Prices alone determine saving
A) Actual / realised
B) Planned / intended
C) Historical only
D) Foreign
A) Planned
B) Intended
C) Actual / realised
D) Expected only
A) S = I
B) S = C
C) I = C always
D) Y = 0
A) ₹100
B) ₹200
C) ₹800
D) ₹1,800
A) 0.2
B) 0.8
C) 1.2
D) 2
A) S = 100 + 0.2Y
B) S = −100 + 0.2Y
C) S = −100 + 0.8Y
D) S = 100 − 0.2Y
A) 0.1
B) 0.2
C) 0.8
D) 1.8
A) ₹100
B) ₹200
C) ₹500
D) ₹800
A) 0.1
B) 0.2
C) 0.5
D) 5
A) 0.2
B) 0.4
C) 0.8
D) 1.2
A) 2
B) 4
C) 5
D) 25
A) 0.1
B) 0.9
C) 1.0
D) 1.9
A) 5
B) 9
C) 10
D) 90
A) −200 + 0.25Y
B) 200 + 0.25Y
C) −200 + 0.75Y
D) 200 − 0.75Y
A) ₹400
B) ₹600
C) ₹800
D) ₹1,000
A) ₹50
B) −₹50
C) ₹1,250
D) 0
A) −150
B) 0.3
C) 0.7
D) 150
A) 0.3
B) 0.5
C) 0.7
D) 1.3
A) Saving positive
B) Saving negative
C) Saving zero
D) Income zero necessarily
A) C = Y
B) C > Y
C) C = 0
D) MPS = 0 necessarily
A) 40% of total income is always saved
B) 40% of additional income is saved
C) 40% of consumption is saved
D) Saving is ₹0.40
A) 40% of total income is saved
B) 40% of additional income is saved
C) MPC = 0.4 necessarily
D) Income is zero
A) APS and MPS are always identical
B) APS uses total values; MPS uses changes
C) MPS = S/Y
D) APS = ΔS/ΔY
A) Assertion మరియు Reason రెండూ సరైనవి; Reason సరైన వివరణ.
B) రెండూ సరైనవి; Reason సరైన వివరణ కాదు.
C) Assertion సరైనది; Reason తప్పు.
D) Assertion తప్పు; Reason సరైనది.
Reason: Additional income is divided between additional consumption and saving.
Reason: Break-even point వద్ద saving is zero.
Reason: S = Y − C.
Reason: Reduced consumption can lower aggregate demand and income.
Reason: MPS measures change in saving relative to change in income.
A) Rises by same amount
B) Falls
C) Remains necessarily unchanged
D) Becomes greater than 1
A) a
B) −a
C) 0 always
D) 1−a
A) ₹10
B) ₹20
C) ₹80
D) ₹100
A) Household/economy is dissaving under the stated measure
B) Saving is positive
C) APC must be zero
D) Income must be zero
A) 0.9
B) 1.0
C) 1.1
D) −1.1
| Concept | Remember |
|---|---|
| Saving | Y − C |
| Saving Function | −a + (1−b)Y |
| APS | S/Y |
| MPS | ΔS/ΔY |
| APC + APS | 1 |
| MPC + MPS | 1 |
| Saving Curve Slope | MPS |
| Break-Even | S = 0 and C = Y |
| Dissaving | S < 0 |
| Positive Saving | C < Y |
| Ex-Ante | Planned |
| Ex-Post | Actual / Realised |
| Paradox of Thrift | Attempt to save more collectively may reduce aggregate demand and income |
| Simple Multiplier | 1/MPS |
S = Y − C
Consumption Function → C = a + bY
Saving Function → S = −a + (1−b)Y
APS → S/Y
MPS → ΔS/ΔY
APC + APS → 1
MPC + MPS → 1
Saving Function Slope → MPS
Break-Even → C = Y and S = 0
Below Break-Even → Dissaving
Above Break-Even → Positive Saving
Ex-Ante → Planned
Ex-Post → Actual / Realised
Paradox of Thrift → Collective attempt to save more can reduce aggregate demand and income
Multiplier → 1/MPS = 1/(1−MPC)
Saving → Saving Function → APS → MPS → APC–APS Relationship → MPC–MPS Relationship → Break-Even → Dissaving → Ex-Ante & Ex-Post → Saving–Investment Relationship → Paradox of Thrift
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