Saving decisions and fiscal incentives: a Spanish panel-based analysis
The objective of this paper is to examine the response of fiscally incentivated savings to income, wealth and a series of individual characteristics. We use a multiple step estimation strategy. Our dependent variable is double censored. Therefore, we first apply a Tobit technique to predict the desired savings, year by year. Then we stack these predictions and build a system of simultaneous equations that is estimated taking into consideration individual effects and cross-equation correlations induced by panel temporal structure and measurement errors in the dependent variables.