Loukas Karabarbounis is Professor of Economics at the University of Minnesota; Brent Neiman is Professor of Economics at the University of Chicago Booth School of Business. This post is based on a recent article, forthcoming in the Journal of Monetary Economics, by Professor Karabarbounis, Professor Neiman, and Peter Chao-Wen Chen, University of Chicago Booth School of Business.
The sectoral composition of global saving changed dramatically during the last three decades. Whereas in the early 1980s most of global investment was funded by household saving, nowadays nearly two-thirds of global investment is funded by corporate saving. In The Global Rise of Corporate Saving we characterize patterns of sectoral saving and investment for a large set of countries over the past three decades. We measure the flow of corporate saving from the national income and product accounts as undistributed corporate profits.
