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Table 1.
Selected Data on Origins of Annual Changes
in Personal Saving
and Their Consistency With Theory, 1953-72.
| Millions of Current Dollars | Years of Significant Short-Run Change | |||||||
|---|---|---|---|---|---|---|---|---|
| Year | Change in Personal Saving | Personal Saving Without Installment Debt Change | Change in Personal Saving Due to Installment Debt | Change in Real Per Capita MPC | Saving / Annual Income Ratio | Identified | Are Data Consistent With Traditional Theory | Are Data Consistent if Installment Debt Change Removed? |
| 1953 | $153 | $-,354 | $507 | 0.95 | 0.072 | |||
| 1954 | -1,904 | -4,943 | 3,039 | -0.22 (2/) | 0.064 | Recession | POSSIBLY (3/) | |
| 1955 | -579 | 4,196 | 4,775 | 1.04 | 0.057 | Recovery | NO | YES |
| 1956 | 4,749 | 2,225 | 2,524 | 0.3 | 0.07 | |||
| 1957 | 171 | -495 | 666 | 1.91 | 0.067 | |||
| 1958 | 1,536 | -838 | 2,374 | 1.22 | 0.07 | Recession | NO | YES |
| 1959 | -3,219 | 2,612 | -5,831 | 1.38 | 0.057 | Recovery | NO | YES |
| 1960 | -2,040 | -3,924 | 1,884 | 2.23 | 0.049 | |||
| 1961 | 4,135 | 1,337 | 2,798 | 0.27 | 0.058 | Recession | NO (4/) | NO |
| 1962 | 439 | 4,345 | -3,906 | 0.97 | 0.056 | Recovery | NO | YES |
| 1963 | -1,648 | 289 | -1,937 | 1.16 | 0.049 | |||
| 1964 | 6,246 | 6,686 | -440 | 0.72 | 0.06 | |||
| 1965 | 2,244 | 3,199 | -955 | 0.89 | 0.06 | |||
| 1966 | 4,095 | 1,246 | 2,849 | 0.82 | 0.063 | |||
| 1967 | 7,839 | 5,670 | 2,169 | 0.55 | 0.074 | Mini-Recession | NO (4/) | NO |
| 1968 | -608 | 4,531 | -5,135 | 1.1 | 0.067 | Recovery | NO | YES |
| 1969 | -1,551 | -508 | -1,043 | 1.27 | 0.06 | |||
| 1970 | 16,644 | 12,243 | 4,401 | 1.12 | 0.079 | Recession | NO (4/) | NO |
| 1971 | 6,080 | 11,072 | -4,292 | 0.8 | 0.082 | Recovery | YES | N/A. |
| 1972(P) | -10,415 | 3,609 | -6,806 | 1.44 | 0.062 | Recovery | NO | NO |
1/ Defined as periods when the rate of change of disposable income deviates significantly from its trend. The pattern
is more evident in quarterly data. For report on fit of model to quarterly data, see Burress, "The Initial Effect of the 1964 tax cut on Consumer Spending," National Tax Journal, 17, (September, 1964), pp. 265-73.2/ Sign explained by reduction in spending as income rose gradually. Unpublished Federal Reserve sources suggest 1954 consumer saving data are inconsistent with theory if separated from data on unincorporated firms.
4/ Short-run or cyclical-MPC concealed in annual data.
5/ Saving-income ratio fell in recovery; annual MPC exceeded apparent LR-MPC.
Sources: Business Statistics, 1971; Survey, July 1972 and July 1973; Federal Reserve Bulletin, December 18, October, 1972 and March 1973.
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