Saving Inclusion in the European Union Countries – Trends and Differences

Abstract :

Motivation: Savings play an important role in economic development. Voluntary savings of households are the most crucial not only for economic development, but also for financial security. However, since 2010, a declining trend in the rate of household savings in the European Union has been observed, which, in the long run, may negatively impact the economy of the region. The research by the World Bank (FINDEX) and other institutions treats the European Union countries as a homogeneous group demonstrating a high level of that phenomenon. Financial inclusion in the EU, in those publications research, constitutes a reference point aimed to show what values may and should be pursued by less developed countries. Yet, even in such a homogeneous group as the EU countries, there is a diversity at the level of making use of financial services, including the gathering of savings.?Aim: The aim of the article is to determine whether the EU countries are a homogeneous group in terms of saving inclusion, and if not, what differences are between them.?Research methods: To analyse the trends in shaping the values of financial assets per capita in the European Union in the years 2008-2018, Hodrick-Prescott filter was used. Verification of similarities between countries was conducted using taxonomic analysis using applying the following methods: (k-means) and Ward’s Hierarchical Cluster Analysis.?Results: The conducted analyses indicated that in the savings’ structure of the EU by sectors, the largest share is held by the private sector, comprised of non-financial companies’ sector and the households’ sector, as well as non-profit institutions operating for their benefit. Due to a strong declining trend of the savings’ rate in the European Union, there are actions taken to increase the rate of saving inclusion in particular countries. The studies have enabled to divide the member states into two groups, according to the level of saving inclusion, into the rich countries of the old EU, and the poorer, mainly post-communist ones. Taking into account various historical experience in terms of gathering assets, preserving their actual value and the necessity for the citizens to ensure their financial security, it is important to take educational actions in terms of the significance of savings for the inhabitants of those countries.