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Definition – What is national savings?
National savings is the total of both public savings and private savings in an economy.
Formula – How to calculate national savings
National Savings = Total Income – Consumption – Government Spending
Example
An economy has total income of $600,000, consumption of $100,000, and government spending of $300,000.
National Savings = $600,000 – $100,000 – $300,000 = $200,000
Therefore, national savings is $200,000.
Sources and more resources
- Wikipedia – National Savings – Description of how to calculate the national savings as well as public and private savings in an economy.
- Econ101help.com – How to calculate National Savings, Public Savings and Private Savings – A description and example formulas for savings calculations.
- Khan Academy – National Savings and Investment – Part of a larger course on Macroeconomics, this video details national savings (including public savings).