DETERMINANTS OF HOUSEHOLD SAVING: EVIDENCE FROM SLOVAKIA

The paper focuses upon determinants of household savings in Slovakia applying quarterly data 1995 Q1 – 2015 Q1. The results contradict to the Life-Cycle Hypothesis as positive relation between saving rate and dependency ratio was identified. Applying ARDL framework we identified the following relations. In the long-run, rising property income and dependency ratio increase household saving, while higher unemployment has a negative influence. In the short-run, savings are positively impacted by property income, dependency ratio, unemployment and saving rate from previous quarter. The speed of adjustment is fast, while about 60% of disequilibrium in the previous quarter will be corrected in the current quarter.