许多分析师和企业高管越来越担心随着近期消费者债务负担的增加，消费债务相对于偿还可预测经济增长能力放缓。
更高的债务减少的农户将不利的经济冲击导致金融经历痛苦的信用状况，如大量没有保险的医疗费用损失。在这种情况下，他们将不太愿意消费，特别是大件物品，如汽车和家用电脑。因此，随着企业削减消费品和下岗工人的生产，消费支出的减少会影响到经济的增长。
家庭花费产生过多的收入，部分原因是因为增加的房价导致了家庭财富的增加。房价的上涨反映了一个调整，持续的低通货膨胀率和利率，其中还有其他因素。然而，房地产市场的活动不能持续在最近几年看到的速度。随着住房市场的降温，消费支出的增长应该缓解和家庭储蓄的上升，导致经常账户赤字下降的趋势，其他一切都是平等的。家庭债务的增加也部分反映了过去20年来政府对金融体系的管制。
Many analysts and business executives are becoming apprehensive with the recent rises in the consumer debt burden, defined as the level of consumer debt relative to ability to repay which may predict an economic growth slowdown.
A higher debt reduces the credit worthiness of households who would then experience financial anguish caused by unfavourable economic shock, such as the loss of a job or large uninsured medical expenses. In the event of this situation, they would be less disposed to spend on consumer goods, particularly big ticket items such as automobiles and home computers. Consequently, the reduction in consumer spending would hurt economic growth as firms cut back on the production of consumer goods and laid off workers.
Households have spent in excess of income, in part because increased house prices have led to increased household wealth. The rise in house prices reflects an adjustment to sustained low inflation and interest rates, among other factors. However, activity in the housing market cannot be sustained at the pace seen in recent years. As the housing market cools, growth in consumer spending should ease and household saving rise, resulting in a tendency for the current account deficit to fall, everything else equal. The increase in household debt also partly reflects the removal of government controls of the financial system over the past two decades.
Based on the results of empirical works of many authors, most studies favour the hypothesis that the causality is from economic growth rate to growth rate of savings. Based on the empirical results, the main conclusion of this study is that income class of a country does play an important role in determining the direction of causality.
A rising consumer debt burden also might predict future activities in broad methods of economic activity, such as real gross domestic product. A decline in consumer spending on durable goods would lower real GDP growth because such spending is a large constituent of real GDP.
Objectives and Organisation of the dissertation
Many tests have been carried out by many authors throughout the world to see if there is a link between household debt, household savings and economic growth and hence, analyse its impact on the discussed variables. A panel cross country analysis has been carried out on 25 countries to determine how household savings and debt may act as a deterrent for economic growth. Chapter 2 reviews the literature and empirical evidence pertaining to the works of various authors concerning economic growth, household debt and household savings. The next chapter deals with the review of variables of interest to us, which will be used in the empirical testing part, hence, the household savings as a proportion of disposable income, household debt as a proportion of GDP per capita, growth rate of Real GDP per capita, consumption share of GDP per capita, price level of GDP, investment share of GDP per capita, interest on savings will be scrutinized in the chapter. In Chapter 4, the Haussman tests have been mostly used to predict the impact of these independent and exogenous variables on the dependent variable of economic growth. Finally in Chapter 5, we conclude on the subject and make some policy recommendation and alongside cite some limitations of the work carried out.
THEORETICAL LITERATURE
When there is a positive change in the level of production of a country's goods and services over a certain point in time, it is referred to as economic growth. It is also influenced by many factors but one of the pinnacles of economic history is the impact household saving and debt has on economic g
