DO THE AGED DISSAVE IN JAPAN - EVIDENCE FROM MICRO DATA

In this paper, we analyze the saving behavior of the aged in Japan usi ng household-level data from a 1992 survey conducted by the Ministry o f Posts and Telecommunications. We find (I) that although the employed aged continue to save, the retired aged are dissaving, on average, (2 ) that 60 percent of the aged in Japan have either a selfish bequest m otive or no bequest motive at all, and (3) that the presence of a self ish bequest motive affects the behavior of both the retired aged and t heir children in the expected ways. All of these findings are fully co nsistent with the life cycle model J. Japan. Int. Econ., September 199 6, 10(3), pp. 295-311. Institute of Social and Economic Research, Osak a University, Mihogaoka, Ibaraki, Osaka 567, Japan; Institute for Post s and Telecommunications Policy, Ministry of Posts and Telecommunicati ons, Tokyo, Japan; and National Bureau of Economic Research, Cambridge , Massachusetts; and Ministry of Posts and Telecommunications, Tokyo, Japan. (C) 1996 Academic Press, Inc.