Bequest motives and the Chinese household saving puzzle

ABSTRACT This study analyses the phenomenon of the high saving rate of China’s households from the perspective of bequest motives based on the data of China Household Finance Survey (CHFS). The result shows that, like Japan, the bequest motives of China’s households have a significant positive effect on the family saving rate, especially on rural household savings, middle-wealth and low-wealth households, those whose children work outside of the government system and those whose children with low education, indicating that the bequest motives of China’s households are more altruistic. This provides a new understanding of the high savings of households in China and can provide a reference for future policy making.