remain stable over the age profile, and thus income distribution among them is
more equal than that among the self-employed households.
5.5 COHORT ANALYSIS
The mean saving rates by cohort are shown in Figure 5.10, constructed from
Table 5.6. A general pattern of the saving rates remains the same as in Figure 5.4;
i.e., even the elderly households keep saving at a substantial margin.
Figure 5. 11 shows the median saving rates by cohort. A general pattern of the
saving rates remains the same as in Figure 5.5; i.e., the households after age 60
reduce their saving rates steadily.
TABLE 5.10 (Continued )
Income class (%)
Year Age I II III IV Mean
50– 11.7 26.9 32.3 39.8 31.6
55– 6.4 31.1 38.0 43.5 35.3
60– 6.5 25.1 36.0 48.7 36.4
65– 13.9 28.3 38.2 52.6 40.5
70– 9.7 29.4 40.4 55.4 42.5
75– 0.1 11.5 40.5 54.4 39.1
80þ11.0 31.8 32.3 50.7 38.0
Average 8.5 24.6 32.3 42.3 31.9
1994 –24 5.9 14.9 16.1 31.8 19.9
25– 7.1 18.6 26.3 36.7 25.3
30– 11.0 26.4 28.7 41.1 29.9
35– 19.0 29.6 33.4 44.4 34.4
40– 16.8 29.7 35.9 43.4 34.6
45– 11.5 25.0 30.1 38.8 29.7
50– 17.7 27.3 31.9 44.5 33.8
55– 16.5 31.8 37.5 44.1 36.4
60– 11.4 22.4 33.9 47.8 35.3
65– 14.2 24.0 35.2 51.9 38.1
70– 12.0 22.7 44.3 51.3 40.3
75– 8.8 33.5 42.4 56.6 43.9
80þ 38.4 38.3 35.2 66.7 51.0
Average 14.2 27.7 32.9 43.0 33.5
Note: Income classes I–IV are yearly income quartile groups.
172 Chapter 5 Savings and Wealth in Japan
TABLE 5.11 Saving Rates of Households with Nonworking Head by Income Class
Income class (%)
Year Age I II III IV Mean
1979 –24 37.3 n.a. n.a. n.a. 37.3
25– 104.2 0.3 22.7 9.8 1.1
30– 48.6 15.7 24.1 24.2 16.2
35– 13.2 8.8 9.4 34.1 18.4
40– 160.8 22.3 16.2 21.5 3.9
45– 73.9 3.5 11.9 4.0 5.6
50– 55.5 14.6 24.4 21.6 4.3
55– 52.2 31.9 7.6 8.0 5.0
60– 35.2 2.6 1.3 25.6 7.3
65– 25.7 13.8 3.7 33.0 11.0
70– 22.4 4.4 15.0 32.4 17.3
75– 2.8 12.6 17.8 44.9 27.5
80þ3.6 7.6 22.5 25.4 16.0
Average 26.7 10.5 5.6 27.1 9.2
1984 –24 n.a. n.a. 15.4 22.1 2.7
25– 0.4 74.1 38.4 10.2 22.9
30– 100.9 11.9 21.1 11.8 9.3
35– 103.6 28.9 3.0 4.6 16.8
40– 135.3 56.3 46.1
5.2 31.3
45– 92.1 6.7 17.0 19.4 6.2
50– 46.1 52.1 10.0 5.6 14.4
55– 63.7 15.1 4.9 28.5 5.5
60– 10.9 0.6 11.0 29.3 14.8
65– 13.8 8.9 8.2 28.5 14.6
70– 9.2 7.3 11.2 32.1 16.9
75– 20.9 11.1 19.8 43.3 25.4
80þ5.1 31.7 25.2 28.3 13.5
Average 21.5 2.7 9.7 28.1 13.4
1989 –24 101.0 33.7 41.1 n.a. 16.9
25– 19.0 45.6 20.0 62.4 18.7
30– 288.8 20.4 25.0 60.7 9.6
35– 120.9 2.3 43.7 48.6 25.3
40– 116.4 16.1 55.8 50.3 39.2
45– 80.4 17.8 28.9 51.2 28.4
(Continues)
5.5 Cohort Analysis 173
Among many cohorts, the baby-boomer cohort (birth year 1945–49)
9
deserves a
special attention because it comprises the largest demographic cohort. As Figure 5.10
shows, the baby-boomer cohort in their forties reduces their saving rates from 1989
to 1994, whereas most neighboring cohorts raised their saving rates in 1994.
Kitamura et al. (2001) conducted analysis of variance (ANOVA) for this cohort data
and found a statistical evidence that the baby-boomer generation indeed started
behaving differently as early as in their forties in 1989.
TABLE 5.11 (Continued )
Income class (%)
Year Age I II III IV Mean
50– 74.1 16.8 20.0 47.5 27.1
55– 50.3 9.2 4.3 39.4 13.4
60– 11.1 4.5 10.1 30.9 13.7
65– 27.9 1.3 10.9 30.9 12.5
70– 7.0 9.5 2.5 36.7 18.0
75– 12.8 5.0 17.6 34.2 18.6
80þ26.2 18.9 36.4 34.5 25.5
Average 22.0 3.0 9.7 34.9 16.2
1994 –24 340.1 0.4 1.4 18.6 3.8
25– 73.0 50.0 38.8 37.4 22.6
30– 34.2 3.3 37.6 45.8 28.6
35– 0.9 19.3 43.1 53.9 38.1
40– 111.2 28.6 42.2 40.1 14.4
45– 71.4 13.2 20.4 44.5 25.2
50– 60.0 10.7 4.4 37.8 12.5
55– 47.3 13.1 3.9 27.8 5.9
60– 32.8 5.6 5.3 31.5 10.0
65– 1.9 4.8 14.2 34.7 18.6
70– 9.2 13.6 13.1 30.6 17.1
75– 8.6 16.3 20.0 37.3 23.0
80þ 4.4 13.2 24.9 47.4 32.5
Average 15.1 5.4 11.4 34.5 17.0
Note: Income classes I–IV are yearly income quartile groups.
9
We have to be careful about the conceptual differences of the baby-boomer generations in the
United States and in Japan. In the United States the baby boomer includes those who were born from
1946 to 1961, whereas in Japan, it usually includes only those who were born from 1946 to 1949.
174 Chapter 5 Savings and Wealth in Japan

Get Life-Cycle Savings and Public Policy now with O’Reilly online learning.

O’Reilly members experience live online training, plus books, videos, and digital content from 200+ publishers.