The Response of Household Saving to the Large Shock of German Reuni fi cation

@inproceedings{FuchsSchndeln2007TheRO,
  title={The Response of Household Saving to the Large Shock of German Reuni fi cation},
  author={Nicola Fuchs-Sch{\"u}ndeln},
  year={2007}
}
German reunification was a large, unexpected shock for East Germans, with different economic consequences for different birth cohorts. Exploiting German reunification as a natural experiment, I analyze the validity of the life cycle consumption model. In the empirical part, I derive three stylized features concerning the saving behavior of East vs. West Germans in the 1990s: (i) East Germans have higher saving rates than West Germans after reunification, (ii) this East-West gap in saving rates… CONTINUE READING
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