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Title: Fatalism and Savings
Resulting in 1 citation.
1. Shapiro, Joel D.
Wu, Stephen
Fatalism and Savings
Journal of Socio-Economics 40,5 (October 2011): 645-651.
Cohort(s): NLSY79
Publisher: Elsevier
Keyword(s): Locus of Control (see Rotter Scale); Risk-Taking; Rotter Scale (see Locus of Control); Savings; Well-Being

An individual’s decision about how much to save depends on her perception of how current savings affects future well-being. Fatalistic individuals believe that they have little or no control over future outcomes. We develop a theoretical model linking fatalism to savings and test the predictions using data from the National Longitudinal Survey of Youth (NLSY). The model predicts that fatalism decreases savings for moderately risk averse individuals, but actually increases savings for highly risk averse individuals. Furthermore, fatalism decreases effort in learning about savings and investment options. The empirical results support the theoretical predictions of the model and are robust to the inclusion of a number of additional control variables.
Bibliography Citation
Shapiro, Joel D. and Stephen Wu. "Fatalism and Savings." Journal of Socio-Economics 40,5 (October 2011): 645-651.