CONSUMPTION
75
the change in income is consumed entirely and again there is no change in
savings as seems to have been the case in the US economy,
as discovered
by Kuznets.
To summarize the discussion (see Table 3.1), if we see a decline in current
savings, we are informed by the theory, we have just developed, that there are
two possible reasons for this to occur—there is a temporary negative current
shock to income (see Figure 3.13), or there is an anticipated positive shock to
future income (see Figure 3.15).
On the other hand, if there is an increase in current savings, then the two pos-
sible reasons for this to have happened ...
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