Download Lab3A

Lab 3A
Exploring Savings Rates
Assignment
This lab investigates the relationships between savings rates and several other country
characteristics. The data for this lab is available in an Excel spreadsheet and a Stata data set on
the textbook web page.
1.
Calculate the average level of the savings rate (gross domestic savings as a percentage of
GDP) in 2009 for all the countries in the data set. Describe the variation in the savings
rate across countries. What is the minimum savings rate? What is the maximum?
2.
Make a scatter plot that shows the relationship between savings rates and income per
capita in 2009, putting GDP per capita on the horizontal axis and savings rates on the
vertical axis. Do poor countries save more or less than rich countries?
3.
Make another scatter plot that shows the relationship between the average investment
rate over the period 1975 to 2009 and the growth rate of income per capita over this time
period. Does this graph support the conclusions of the Solow model?
4.
Make a scatter plot that shows the relationship between savings rates and secondary
school enrollment rates. Do countries that have higher secondary school enrollment rates
have higher savings rates?
5.
Make a scatter plot that shows the relationship between savings rates and the number of
children the average woman can be expected to have (the fertility rate). In countries in
which women have more children, is the savings rate higher or lower?
6.
Using the results of your graphs, write a paragraph that describes that summarizes your
conclusions. How do savings rates vary across countries? What country characteristics
are associated with higher savings rates? Can you make policy recommendations based
on your results?
Excel Hints for Lab 3
See the “Introduction to Excel” instructions for step-by-step instruction on creating scatter plots.
Excel hints at the bottom of lab 1 contain instructions for calculating growth rates.
Stata Hints for Lab 3
See the “Introduction to Stata” instructions for step-by-step instructions on creating scatter plots
and generating new variables in Stata.