Wealth and Trust in General in the Most Aged Society, Japan

Japan used to be characterized by high saving rates in the 1960s and 70s mainly to prepare for the uncertain future under the immature social security system (Tachibanaki 1997). Horioka (1989; 2007; 2010) claimed the life cycle hypothesis to explain relatively higher saving rates in Japan compared with the US or other nations, and once the population ages, the overall saving rates could decline because the proportion of older people who have relatively low rates of saving increases. However, according to Unayama and Ohno (2017), the percentage of older people with low savings rates increased.

Our main research question is how the savings changed during the life course since 2010 among older people aged 60 and over, and how such a change is associated with their trust in general. We want to see how people construct trust in general beyond self-interests because trust in general could lead to the development of generational justice for the future.

The data that I will analyze is waves 1 through 7 of the Panel Study for Senior People in Japan (JPSSP), which has been conducted every 2 years since 2010. JPSSP respondents included men and women between the ages of 50 and 84 years in 2010. The number of respondents analyzed for this study was 1,152 (50.4% men, 49.6% women, aged 60 to 96 years old). We run the fixed model analysis on personal savings. The age, marital status (married or not), personal income (log), the number of children, and having bequests from their parents are included in our analysis. We confirmed a positive age effect on the change in savings, and such a saving behavior of older people to continue after the later stage of life might lead to negative effects on their trust in general.