Savings and culture - new research from the London School of Economics
The London School of Economics and Political Science has published new research to suggest that how much a person saves could be influenced by their grandparents' place of birth.
Dr Becky Ozcan from the Department of Social Policy says ' Our research show that culture should be taken into account when designing incentives and policies for saving behaviour'.
Published in the PLOS One journal, it states that UK-born grandchildren of immigrants tend to mirror the money saving behaviour of their grandparents' country of birth. An example given was that the UK-born children and grandchildren of people born in countries with high saving rates such as China tended to save at a higher rate.
The study used long-term data to explore the saving habits of UK migrants, their children and grandchildren and found that culture impacts on saving behaviour for up to three generations. This is despite living under different economic and institutional conditions including tax and welfare systems.
Dr Ozcan says the research is important because it contributes to understanding the determinants of saving behaviour. Social scientists she explains, have been trying to understand this in order to design various policies, such as those in the retirement and pensions area.