The Empirical Research On The Relation Between Social Security And National Optimal Savings Ratio

The excessive savings ratio is a hot topic these years. Savings ratio is a very important index in macroeconomic, it is very important to the stabilization of the national economy, excessive savings ratio is a kopis to the economy. It can afford cash support to the development of national economy, but if it is too excessive, it will reduce the consumption and harm the health of the economy. Our national savings ratio is far more than the average level of OECD countries, even compares with the Asian countries, it seems too high, but the conclusion that there is excessive savings ratio can not be confirmed. Because different countries commonly have different economic, culture and social background, the conclusion is very different. This paper solves this problem with Ramsey model. The technique of the paper is to simulate, under various assumptions, an Ramsey model for China for the period from 1997 to 2012. From these assumptions the paper calculates the optimal levels of national saving is about 27%, it is far less than the current savings ratio. For the target of maximize the welfare of the national people, China should increase the savings ratio. The social security is one of the most important part of the Social Insurance. The paper estimates the social security wealth is about 8 trillion in 2006, these wealth is as important as the saving balance. The paper concludes that social security in 2006 could reduce about 31.09% of the savings, so increasing the social security scale could improve the level of social security and reduce the savings ratio, then we achieve the target of killing two birds with one stone.This paper takes systematic analysis of national optimal savings ratio and the relation between social security and savings by taking the qualitative method and quantities method, it has important significance for policy makers.