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This is confusing. If you save, you have more wealth. If you have more wealth, you are more resilient to hardships (economic, health, etc.) - a population of pe

This is confusing. If you save, you have more wealth. If you have more wealth, you are more resilient to hardships (economic, health, etc.) - a population of people with large savings accounts and low debt seems obviously better than a population that makes a ton of money but lives close to the wire or carries large debts

jldugger 6y ago
The problem though is that personal savings grows over time -- a nation full of young people with high incomes will eventually become a nation full of weathly old people, but if you were to compare the two nations, the yard stick matters. edit: if you want to cook up some evidence, look at a scatter plot of some indicator of age (national average age?) vs national average wealth. I suspect, given the countries at the top of the list, you'll end up with a pretty good r.
scatters 6y ago
Resilience is unnecessary in countries with a safety net. Are individuals in those countries who make the rational decision to save less somehow worse off than those who have to carry a large savings buffer to guard against misfortune?
- Polylactic_acid 6y ago
  >Resilience is unnecessary in countries with a safety net Not entirely. Having a safety net might be the difference between having a home/food and being on the street but having savings and a safety net allows you to live your previous comfortable life while not working. If you have a healthy savings then you can afford to willingly leave your current job and have some time to yourself while you look for a better job.
- im3w1l 6y ago
  Safety net usually come with caveats. Foodstamps are as their name suggests not general purpose dollars. Sometimes you have to perform tasks you don't want to do to benefit from the safety net. Your own money can be used for whatever you want and no need to beg and justify before a government employee.
nearbuy 6y ago
I think you're double counting the advantage for wealth if you consider resilience an advantage, but don't consider not spending money to be a disadvantage. Keeping money reserved for hardships is a lot like having spent the money, since you can no longer use that money to increase your standard of living. If you put away $50,000 in case of job loss or health problems, you've bought resilience at the opportunity cost of $50,000 worth of something else. If you change your mind later and spend it, you just traded in your resilience for other goods and services. You have the benefit of resilience or the benefit of whatever else you might buy with that money, but not both at the same time. When you look at consumption numbers for a country, they already include what people have spent to deal with hardships. Wealth, however, doesn't tell you how much in poverty someone had to live in order to save that wealth. Insurance is a formal way of spending money on resilience. Insurance, though, has the advantage of pooling risk among a large number of people. You don't actually have to save up millions to be insured for millions in healthcare bills. Someone with excellent insurance but little savings can have both more resilience and a higher standard of living than someone who lives in poverty to save every penny, but doesn't spend on insurance.

jldugger 6y ago

The problem though is that personal savings grows over time -- a nation full of young people with high incomes will eventually become a nation full of weathly old people, but if you were to compare the two nations, the yard stick matters. edit: if you want to cook up some evidence, look at a scatter plot of some indicator of age (national average age?) vs national average wealth. I suspect, given the countries at the top of the list, you'll end up with a pretty good r.

scatters 6y ago

Resilience is unnecessary in countries with a safety net. Are individuals in those countries who make the rational decision to save less somehow worse off than those who have to carry a large savings buffer to guard against misfortune?

Polylactic_acid 6y ago
>Resilience is unnecessary in countries with a safety net Not entirely. Having a safety net might be the difference between having a home/food and being on the street but having savings and a safety net allows you to live your previous comfortable life while not working. If you have a healthy savings then you can afford to willingly leave your current job and have some time to yourself while you look for a better job.
im3w1l 6y ago
Safety net usually come with caveats. Foodstamps are as their name suggests not general purpose dollars. Sometimes you have to perform tasks you don't want to do to benefit from the safety net. Your own money can be used for whatever you want and no need to beg and justify before a government employee.

nearbuy 6y ago

I think you're double counting the advantage for wealth if you consider resilience an advantage, but don't consider not spending money to be a disadvantage. Keeping money reserved for hardships is a lot like having spent the money, since you can no longer use that money to increase your standard of living. If you put away $50,000 in case of job loss or health problems, you've bought resilience at the opportunity cost of $50,000 worth of something else. If you change your mind later and spend it, you just traded in your resilience for other goods and services. You have the benefit of resilience or the benefit of whatever else you might buy with that money, but not both at the same time. When you look at consumption numbers for a country, they already include what people have spent to deal with hardships. Wealth, however, doesn't tell you how much in poverty someone had to live in order to save that wealth. Insurance is a formal way of spending money on resilience. Insurance, though, has the advantage of pooling risk among a large number of people. You don't actually have to save up millions to be insured for millions in healthcare bills. Someone with excellent insurance but little savings can have both more resilience and a higher standard of living than someone who lives in poverty to save every penny, but doesn't spend on insurance.