Journal Article Employment and Industrialization: Comment Get access Benjamin I. Cohen, Benjamin I. Cohen Harvard University Search for other works by this author on: Oxford Academic Google Scholar Nathaniel H. Leff Nathaniel H. Leff Harvard University Search for other works by this author on: Oxford Academic Google Scholar The Quarterly Journal of Economics, Volume 81, Issue 1, February 1967, Pages 162–164, https://doi.org/10.2307/1879682 Published: 01 February 1967

Nathaniel H. Leff, Kazuo Sato, Macroeconomic Adjustment in Developing Countries: Instability, Short-Run Growth, and External Dependency, The Review of Economics and Statistics, Vol. 62, No. 2 (May, 1980), pp. 170-179

Postwar experience has confirmed the central importance of domestic savings rates for capital accumulation and other goals in developing countries. Consequently, both for analytical and for policy purposes, it would be helpful to estimate savings functions which are grounded in economic theory and whose parameters are properly identified and free from simultaneous-equations bias. Accordingly, we have formulated a simultaneous-equations model of aggregate saving in developing countries and estimated its parameters with time-series data for five countries (Brazil, Costa Rica, Israel, the Philippines, and Taiwan). On the basis of the parameter estimates, steady-state savings ratios should rise significantly if these countries experience higher rates of income growth. However, for reasons we discuss, an upward movement in savings rates did not occur in these countries over the sample period.