Mobility of household saving in Poland during 2007-2010

In this paper we analyse the saving mobility of Polish households, e.g. the mobility of households between classes of different saving rates. The analysis is based on the household budget panel data of 15,000 Polish households surveyed during 2007-2010. We apply the Markov mobility matrix. We estimate the long-term ergodic structure of households with regard to saving rates. It illustrates the probability of a household to fall into one of the saving rates classes ranging from negative savings of 15% or less of household disposable income to positive savings of 15% or more of household disposable income. Our results show that during four consecutive years (2007-2010) one third of households that had negative savings of 15% of household disposable income in the first year of observation remained in their class also the following year. But another third of this group of households “jumped” in the following year to the group of households with positive savings of more than 15% of household disposable income. In the class of households with highest saving rates almost two thirds of households kept these high saving rates. In the long term, the probability of a household to fall into a group of households with lowest saving rates is less than 0.2. The highest probability (0.5) was to fall into a group that saved more than 15% of household disposable income. It shows the tendency towards polarization of households with regard to saving rates. 

Key words: household, income, saving, mobility, Markov matrix, panel analysis