HOUSEHOLD SAVING IN FRANCE - STOCHASTIC INCOME AND FINANCIAL DEREGULATION

The household saving ratio in France underwent sharp changes over the past two decades, falling dramatically in the early 1980s before risin g more recently. This paper emphasizes two factors in the evolution of private saving in France. The first relates to perceptions of househo ld income growth and uncertainty, which have likely been affected by d eteriorating labor market conditions and may therefore help account fo r the recent increase in saving. The second relates to financial dereg ulation, which may have lowered saving and increased its sensitivity t o interest rate changes. Both have played some role in the evolution o f French household saving.