Modelling the Impact of Economic, Demographic and Social Determinants on Household Saving Rate in the Former Socialist Countries (Central and Eastern Europe)

The main sector of a national economy that saves is the household sector. Its saving behaviour is determined by a complex of economic, social, demographic and cultural factors. Their determination is of utmost importance for the foundation of the policies aimed at stimulating household savings.Identification of the main determinants of population savings is done using panel data for 6 European countries for the 1995-2010 period.The present paper aims at analysing and modelling the saving behaviour of the households in the Central and Eastern Europe. Due to the fact that the countries in Eastern Europe, unlike the other European states, are affected not only by the world financial crisis, but also by the transition to market economy after 45 years of hyper-centralized model of the socialist economy.The empirical results obtained are quantified with the help of a fixed-country-specific effect model that estimates the net saving rate. The model allowed for highlighting some individual particularities of the countries and groups of countries, showing that the type of saving behaviour is influenced by them.