Statistical analysis of saving habits of employees: a case study at Debre Birhan Town in North Shoa, Ethiopia (original) (raw)
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Saving represents one of the most predictable determinants of successful personal and economic development. People desire to save although they tend to postpone saving until they have higher-paying jobs or some stability in their lives. However, in developing countries, where opportunities for structured and institutionalized saving are rare, people could perhaps begin saving earlier than expected. The purpose of this study has been to assess saving habits and identify factors that influence the saving habits of employees at Deber Birhan town. A sample of 480 was collected from employees on saving habit at Debre Birhan town during February, 2010 to October, 2011. Saving habit was measured according to multi method tool that incorporates self report, visual analog scale and economic identification test. Descriptive, Binary logistic regression and Bayesian statistical methods were used. The result indicates that 47.29% employees had no saving experience and 52.71% of the respondents have been involved in saving part of their income. It was also found that government employees have lower saving habits than the private employees. The results obtained from the analysis of binary logistic regression indicate that age, education, number of dependent family members, transport service, job satisfaction in the sector, cost of expenditures and inflation significantly affect the saving habits of employees. Being a member of saving association, cost of recreation and housing are also significantly related with saving habits of employees. Results from binary logistic regression indicate that after controlling other variables in the model, the odds of saving decreases for instance by 43.4% for one unit increases in number of dependent family members. Employees who had job satisfaction in the sector were less likely to be in no saving habit with odds 2.491. The result from Bayesian analysis indicates that monthly salary, distance from home to work place and supporting others with money were significant predictors of saving habits. Furthermore, education, number of dependent family members, cost of expenditures and monthly salary are important factors affecting saving habits of employees.
Saving is considered as an important variable in the theory of economic growth determining both national and individual wellbeing. However, saving level in Ethiopia is very low and little is known empirically about its determinants. This study was conducted with the objectives of assessing the saving habits and identifying the demographic variables that significantly influence saving decision of salaried employees in Wolaita Sodo town, Ethiopia. In order to meet these objectives, primary data were obtained by distributing self-administered questionnaires to a sample of 209 respondents. The data were distributed to the respondents using covenant sampling technique. Logistic regression model was used to analyze the effect of explanatory variables, like gender, age, educational level, field study, marital status, working experiences and income level on the dependent variable which is saving decision. A total of seven explanatory variables were included in the regression. The results obtained from the analyses conclude that only field study and income level of the salaried employees have a significant impact on saving decision of the salaried employees. Moreover, the results of the study conclude that gender, age, field study, experience and income level have a strong relationship with saving rate of the respondents, but educational level and marital status do not have a strong relationship with saving rate of the respondents. Finally, it is recommended that the responsible bodies to create wide range of awareness in urban and rural areas through financial education and training relating to saving and finance.
Determinants of Households Saving Behavior: Case of East Gojjam Zone, Ethiopia
Resource accumulated in the form of capital and available for current and future investment is the foundation of economic growth. Saving is one of the best mechanisms of accumulating capital. The main purpose of this study is to investigate determinants of household saving behavior living in rural and urban areas. The study was conducted in East Gojjam Zone of Amhara regional state of Ethiopia. Respondents were selected through two stage-sampling techniques, and 400 households were participated in the study. Primary data was collected from household heads by implementing household survey with in similar time interval. The collected data was analyzed using odd ratio logistic regression model. The findings of the study show that most households save their income, and personal saving habits of household head, the existence of financial planning and annual income of household determine the saving behavior of households. To improve the saving practice of household continuous training should be delivered concerning how to develop and implement financial planning, adopt positive personal saving habits and effectively manage earnings. Key words: Saving behavior, households, planning, logistic model, Ethiopia.
Abdella Mohammed Ahmed (M.Sc.), 2024
Saving is the most fundamental economic variable to be investigated within an economy on an individual and also household basis. Saving is the act of reducing present consumption for future consumption. In addition, it is important to maintain and expand an economy’s capital structure and in turn lays foundation for long run economic growth. The study was concerned on factors affecting saving habits; the case of hirna town, west hararge. The study applied multistage sampling technique to conduct the study. Hirna Town have four kebele’s were selected randomly. There are 3364 household heads in these Kebeles, from these 149 rural household heads were randomly selected as the representative of rural household in the study area. Based on the explanatory research design, the study applied mixed approaches. For the purpose of the study a cross sectional data were collected from 188 sample households and both primary and secondary data were used. Interview schedule were used to collect primary data from the sampled households. For the purpose of data analysis, descriptive statistics (frequency distribution, cross tabulation), chi-square test, p-value test and Binary logit econometric model were used. Inferential statistical techniques such as correlation and regression analysis were employed to test the hypotheses of association and differences. Collected data w ere processed using the Statistical Package for Social Science (SPSS) of version 20. The finding of this research revealed that, Religion, Education level and distance have negative and statistically significant effect on saving of households. The total family of household & Landholding size have positive contribution for household savings and statistically significant. Finally, Sex, Age, Marital status, Occupation, Dependent family, Monthly income, and Livestock ownership of households have statistically insignificant effect on saving of households. he results ultimately revealed that age of household head, education, training, membership to cooperatives, farm and off-farm income, farm size, and livestock were significant and influencing positively rural households’ savings. Whereas expenditure, family size, and distance to savings associations were significant variables that influenced the saving behavior of rural household negatively in the study area. These factors therefore have to be considered in designing strategies aimed at improving the saving mobilization of rural households.
Abdella Mohammed Ahmed (M.Sc.), 2024
This study examined the factors that affect saving behaviour of rural households in Benishangul Gumuz Regional Sate. It employed descriptive statistics and double hurdle model to analyse the data collected from a sample of 325 rural households in the study area. The descriptive result showed that about 83.4 per cent of sampled households involved in saving of which 68 per cent use formal financial institutions and the remaining opt for alternative saving options. The result of double hurdle model provided empirical evidence on a positive significant effect of age, income and level of education of the head on a decision of households to save; whereas household size, distance to formal financial institutions and employment status have negative influences on household’s decision to save. With regards to the extent of saving; income of household head, level of education, landholding size and involvement in petty trade has a positive significant impact on amount of saving; whereas household size, employment status and distance to formal financial institutions significantly reduced the amount of saving by households. The findings implied the need for designing strategies that could improve the saving behaviour, mobilization and diversification of saving by rural households. Moreover, the need for government involvement in building the capacity of rural households in terms of education and information systems with regards to savings as well as encouraging financial institutions to implement door-to-door service provisions so as to enhance saving behaviour of households are desirable. Household, Savings, Double hurdle, Assosa.
Investigating and Trend Analysis of Saving Culture among Households in Ethiopia
Abdella Mohammed Ahmed (M.Sc.), 2024
The saving rate of Ethiopia to GDP is 9.5% which is, the worst saving rate in the world as compared to China, Bangladesh and South Africa which have a better saving rate in the world. Ethiopia is characterized by poor saving cultures which result in very small domestic savings available for investment. The government knowing this fact has planned in the 5 year Growth & Transformation Plan of the country (2003 -2007 E.C) to increase saving rate from 9.5% to 20% of the GDP. To achieve the plan, there is therefore a need for investigating the root cause of poor saving habit. In order to achieve the objectives, a survey study using qualitative and quantitative approaches was conducted. Herein, 544 households were selected from three major cities namely Addis Ababa, Hawassa, and Mekelle on basis of non-proportional quota sampling technique. The questionnaire accomplished by household was the research instruments used for the data-gathering. The study employed chi-square test and other descriptive statistics to analyse the data and results of the survey was processed using SPSS. The result of the study indicates that saving culture of the society is poor despite the performance improvement of saving rate. The cause of the poor saving identified in this study includes lack of appropriate saving products, lack of incentive to save, low income level, high level of debt, low interest rate, high inflation and others. Based on the investigation the study suggest that government and other sectors must work in creating awareness of saving in the society, stabilization of inflation, implementing forced saving, modernization and accessible the saving institution, stabilization of the income level of the society, reviewing the saving interest rate and others.
Determinants of Saving Behavior of Households in Ethiopia: The Case Benishangul Gumuz Regional State
Journal of economics and sustainable development, 2017
This study examined the factors that affect saving behavior of rural households in Benishangul Gumuz Regional Sate. It employed descriptive statistics and double hurdle model to analyze the data collected from a sample of 325 rural households in the study area. The descriptive result showed that about 83.4 percent of sampled households involved in saving of which 68 percent use formal financial institutions and the remaining opt for alternative saving options. The result of double hurdle model provided empirical evidence on a positive significant effect of age, income and level of education of the head on a decision of households to save; whereas household size, distance to formal financial institutions and employment status have negative influences on household's decision to save. With regards to the extent of saving; income of household head, level of education, landholding size and involvement in petty trade has a positive significant impact on amount of saving; whereas household size, employment status and distance to formal financial institutions significantly reduced the amount of saving by households. The findings implied the need for designing strategies that could improve the saving behavior, mobilization and diversification of saving by rural households. Moreover, the need for government involvement in building the capacity of rural households in terms of education and information systems with regards to savings as well as encouraging financial institutions to implement door-to-door service provisions so as to enhance saving behavior of households are desirable.
Utilization of and Factors Affecting Individuals Saving in Ethiopia ( The Case of Dire Dawa )
2016
Ethiopia is currently implementing its growth and t ransformation plan to boost its economic growth overtime with the goal to join the middle income co untries within few years. It is believed that this objective can be realized if the country can make s ubstantial amount of investment in the economy. However, currently, much of the capital accumulatio n s brought about from foreign direct investment. The rate of saving in the country has been low. Hea vy reliance on foreign capital may have adverse economic implication for sustainability of economic growth of the country in the future (Dixon and Boswell, 1996). In cognizant of this, this study wa s undertaken to investigate pattern of individuals’ saving utilization using behavioral approach and to assess the role of concerned bodies/organizations in improving household saving; in the case of Dire Daw a City. The mainly used primary survey data on individual employees, and formal and informal finan ci l institutions. Both descripti...
Determinants of Households Saving: The Case of Shashamene Town, West Arsi Zone, Oromia, Ethiopia
The study was conducted to identify factors affecting household savings in Shashamene town. Primary data were collected using questionnaires, and secondary data sources were also collected from written documents and journal articles. The study used a random sampling technique so that each household would have an equal chance of being selected. To collect primary data, a questionnaire and a total of 381 respondents were included in the survey. To attain the objectives of the study, the researcher employed a descriptive method and logit regression model to analyse the determinants of household savings. Thirteen explanatory variables were included in the model's equation. The results of logit regression indicated that seven variables were statistically significant. Sex of the household head, age of the household head, marital status, family size, household tenure, household annual expenditure and access to credit were among the significant factors affecting household savings. From these significant variables: household head sex, age, Marital status and access to credit positively affected household savings, while the remaining variables negatively affected household savings. Two-sample t-tests and chi-squared tests were employed to compare saver and non-saver patients. Hence, efforts should be made to increase the real income of households through well-paying and better job creation by the establishment of micro-and small-scale enterprises, with the increased provision of economic and social infrastructure. Thus, stakeholder interventions to tackle the determinant factors are important measures to be undertaken.
Assessment of Saving Culture among Households in Ethiopia
Journal of Economics and Sustainable Development, 2013
The saving rate of Ethiopia to GDP is 9.5% which is, the worst saving rate in the world as compared to China, Bangladesh and South Africa which have a better saving rate in the world. Ethiopia is characterized by poor saving cultures which result in very small domestic savings available for investment. The government knowing this fact has planned in the 5 year Growth & Transformation Plan of the country (2003-2007 E.C) to increase saving rate from 9.5% to 20% of the GDP. To achieve the plan, there is therefore a need for investigating the root cause of poor saving habit. In order to achieve the objectives, a survey study using qualitative and quantitative approaches was conducted. Herein, 544 households were selected from three major cities namely Addis Ababa, Hawassa, and Mekelle on basis of non proportional quota sampling technique. The questionnaire accomplished by household was the research instruments used for the data-gathering. The study employed chisquare test and other descriptive statistics to analyse the data and results of the survey was processed using SPSS. The result of the study indicates that saving culture of the society is poor despite the performance improvement of saving rate. The cause of the poor saving identified in this study includes lack of appropriate saving products, lack of incentive to save, low income level, high level of debt, low interest rate, high inflation and others. Based on the investigation the study suggest that government and other sectors must work in creating awareness of saving in the society, stabilization of inflation, implementing forced saving, modernization and accessible the saving institution, stabilization of the income level of the society, reviewing the saving interest rate and others.