The basic issue
The savings rate refers to the amount of savings as a percentage of GDP, while household savings measure the change in financial assets during a period. Financial savings include bank deposits, savings in mutual funds, pension funds, and payments for consumer durables. The gross financial savings to GDP ratio declined by 3 percentage points, from 7.3% to 5.3% in 2022-23. This sudden fall in household savings has become a cause for concern.
Some theoretical issues
Neo-classical economic theorists, such as Alfred Marshall and Arthur Pigou, argue that a mature capitalist economy will always maintain full employment, meaning no economic inputs remain unutilized. If some inputs are underutilized, economic activity will adjust until price fluctuations balance supply and demand, achieving general equilibrium. In this state, the supply of savings will equal the demand for investment. Excess savings will move to economies where investment demand exceeds savings supply, and vice versa.
Esta historia es de la edición June 01 - 30, 2024 de BUSINESS ECONOMICS.
Comience su prueba gratuita de Magzter GOLD de 7 días para acceder a miles de historias premium seleccionadas y a más de 9,000 revistas y periódicos.
Ya eres suscriptor ? Conectar
Esta historia es de la edición June 01 - 30, 2024 de BUSINESS ECONOMICS.
Comience su prueba gratuita de Magzter GOLD de 7 días para acceder a miles de historias premium seleccionadas y a más de 9,000 revistas y periódicos.
Ya eres suscriptor? Conectar
Bank of Baroda, Kolkata Zone organised Mega Kisan Melas in West Bengal
Bank of Baroda (BOB) organised Mega Kisan Mela at Konkalitala in Birbhum District of West Bengal on November 18, 2024 as a part of the 7th Edition of the Baroda Kisan Pakhwada (BKP).
Time-Bound Disposal of Cases to Expedite the Delivery of Justice and affordabe by all in India
The delay in the disposal of cases in Indian courts remains a significant hurdle to the nation's progress.
Dev Deepawali: A grand celebration of light, spirituality, and culture in Varanasi
The holy city of Varanasi, often regarded as India's spiritual and cultural heart, came alive with the splendor of Dev Deepawali on the sacred day of Kartik Purnima.
The life of Job 'Ye judge not the judgment of God' - Jesus Christ
The Holy Bible reveals through the life of Job how the Lord tests the righteous and that faith helps one to overcome life's adversities.
India has the highest potential for the garment industry, only a conducive government policy is required.
India's textile industry is poised for remarkable growth, with expectations to double its contribution to the GDP within the next six to seven years.
Global Public Debt may be worse than it appears, warns IMF
Global Public Debt Set to Exceed $100 Trillion, Warns IMF
The economic consequences of Trump's Presidency: A global perspective
One of the key economic factors contributing to the Democrats' loss in the US elections was the significant rise in inflation, which was initially triggered by the COVID-19 pandemic and exacerbated by the Russia-Ukraine war.
Challenges and Successes in West Bengal's Education Sector: A Comprehensive Overview
The education system in West Bengal, particularly in districts, villages, slums, and government institutions, reflects a blend of progress and ongoing challenges.
What India can expect from Trump's return
I may be too early to predict how Donald Trump's second term as president will impact the global oil market.
Stocks Surge Following Donald Trump's Election as 47th President of the USA
Stocks soared following the election of Donald Trump as the 47th President of the United States. Investors anticipated that the Information Technology (IT) sector would benefit from lower corporate taxes under the Republican regime, with IT stocks leading the rally.
