Resumo

According to the World Bank (2021), gross national savings in Brazil as a percentage of gross domestic product (GDP) was 12 percent in 2019. This value is well below East Asia and Pacific (42 percent), South Asia (28 percent) and even Latin America (16 percent). In essence, national savings are the aggregates of heterogeneous households' (or individuals') personal savings decisions (Gandelman, 2016). The low level of individual savings generates a deficient supply of private savings, which is not enough for the normal interest rate's investment demand.

From the individual perspective, savings are essential because they generate financial safety during retirement, unexpected financial expenditures, and helping in difficult situations such as disease and job losses (Iregui-Bohórquez et al. 2018). Therefore, understanding household saving behaviour, specifically its determinants, has focused on a lot of empirical research (Hua and Errygers, 2019). Therefore, this paper aims to reveal the effects of economic and demographic individual characteristics on Brazil's individual savings.

From a macroeconomic perspective, private saving has contributed to economic growth (Deaton and Paxson, 2000; Niculescu-Aron and Mihaescu, 2014; Hua and Erreygers, 2019) for reducing dependence on external resources (Moreira and Silveira, 2019; Paiva and Jahan, 2003). Private saving also may provide financial security for unexpected events from a microeconomic context. Microeconomic studies present an important contribution to the literature on savings to improve the understanding of the Life Cycle Hypothesis (LCH) (Butelmann and Gallego, 2001).

Our first empirical approach attempts to identify the determinants of savings in Brazil and then how these factors contribute to the amount of savings. We use data drawn from the 2017-2018 Household Budget Surveys (POF), which contains information on expenditure, earnings as well as detailed information on the cultural, demographic, economic, and social characteristics of its participants. These data provide us with a unique opportunity to investigate the determinants of individual savings in Brazil.

Our results shed light on this particular issue during the current discussion of Brazil's social providence, a particularly crucial moment. n essence, our results highlight that: (i) the majority of Brazilians (84%) do not save; and (ii) there are, in fact, a number of economic and social factors that influence individual savings, which, in turn, gives rise some important public policy implications, mainly considering the contemporary political debate has arisen over the social security in Brazil.

Our empirical analysis found a nonlinear relationship between age and savings, following the Life-Cycle Hypothesis (LCH). By analysing individual savings, we sought to break new ground on Brazil's empirical analysis of savings. Moreover, our paper represents the first attempt at extending this line of inquiry into Brazil. Although some paper analyses savings in Brazil, efforts were allocated to investigate the household savings in 2008 and earlier years.

Modigliani, F. and Brumberg, R.H. 1954. "Utility Analysis and the Consumption Function: An Interpretation of Cross-Section Data." In Post-Keynesian Economics, edited by Kurihara, K.K., 388-436. New Brunswick: Rutgers University Press. Hua, T. X., and Erreygers, G. 2019. "Applying quantile regression to determine the effects of household characteristics on household saving rates in Vietnam." Journal of Asian Business and Economic Studies. 27 (2): 175-193. Paiva, C., and Jahan, S. 2003. "An empirical study of private saving in Brazil." Brazilian Journal of Political Economy, 23(1): 124-137.