<p>The first point is that this is a flow statistic: it is the annual excess of income over consumption, in contrast to level statistics such as gross national debt which are largely accumulations of past flows.</p>

<p>As what gross national saving is for: it funds investment, which affects future income and thus future consumption.  Indeed, one of the tautologies of macroeconomics is that Savings = Investment.</p>

<p>A low savings/GDP figure may indicate excessive consumption or insufficient  income.  It may lead to either inadequate domestic investment or the need to borrow from foreigners to fund domestic investment.</p>

<p>A high savings/GDP figure may indicate insufficient consumption or excessive income.  It may lead to either unproductive domestic investment or the need to lend to foreigners to recycle the funds.</p>

<p>There is no optimal figure for savings. Comparative figures for different countries and global trends over time are published, for example from the <a href="http://data.worldbank.org/indicator/NY.GNS.ICTR.ZS?end=2014&amp;start=1977" rel="nofollow">World Bank</a>.</p>

CC BY-SA 3.0
2016-08-23T08:22:37.120Z
2016-08-23T08:22:37.120Z
Henry
<p>I don't understand what the term <code>Gross National Saving</code> is for. According to <a href="https://www.cia.gov/library/publications/the-world-factbook/rankorder/2260rank.html" rel="noreferrer">the world factbook</a>, it represents the following:</p>

<blockquote>
  <p>Gross national saving is derived by deducting final consumption expenditure from Gross national disposable income, and consists of personal saving, plus business saving, plus government saving, but excludes foreign saving. The figures are presented as a percent of GDP. A negative number indicates that the economy as a whole is spending more income than it produces, thus drawing down national wealth (dissaving).</p>
</blockquote>

<p>This represents the sum of savings by person, company, and government. But what is this beneficial to? Is a country that has high GNS more stable in finance? When should one look at this statistics to gauge what? In financial stability, is this a better indication than national debt as a percent of GDP, the dependency rate on government bond, or something others?</p>

<statistics><definition><economic-terms>
What is the "gross national saving" for?
Blaszard
# What is the "gross national saving" for?

(Asked by: username_0 on 2016-08-22)

I don't understand what the term `Gross National Saving` is for. According to [the world factbook](https://www.cia.gov/library/publications/the-world-factbook/rankorder/2260rank.html), it represents the following:

> Gross national saving is derived by deducting final consumption expenditure from Gross national disposable income, and consists of personal saving, plus business saving, plus government saving, but excludes foreign saving. The figures are presented as a percent of GDP. A negative number indicates that the economy as a whole is spending more income than it produces, thus drawing down national wealth (dissaving).

This represents the sum of savings by person, company, and government. But what is this beneficial to? Is a country that has high GNS more stable in finance? When should one look at this statistics to gauge what? In financial stability, is this a better indication than national debt as a percent of GDP, the dependency rate on government bond, or something others?

**Tags:** statistics, definition, economic-terms

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## 1 answers

### Answer by username_1 on 2016-08-23. Score: 1

The first point is that this is a flow statistic: it is the annual excess of income over consumption, in contrast to level statistics such as gross national debt which are largely accumulations of past flows.

As what gross national saving is for: it funds investment, which affects future income and thus future consumption. Indeed, one of the tautologies of macroeconomics is that Savings = Investment.

A low savings/GDP figure may indicate excessive consumption or insufficient income. It may lead to either inadequate domestic investment or the need to borrow from foreigners to fund domestic investment.

A high savings/GDP figure may indicate insufficient consumption or excessive income. It may lead to either unproductive domestic investment or the need to lend to foreigners to recycle the funds.

There is no optimal figure for savings. Comparative figures for different countries and global trends over time are published, for example from the [World Bank](http://data.worldbank.org/indicator/NY.GNS.ICTR.ZS?end=2014&start=1977).


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