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Week
5 ANOVA Exercises SPSS Output
Descriptives
Overall satisfaction, material well-being
N Mean Std. Deviation Std. Error
95% Confidence Interval for
Mean
Minimum Maximum
Lower Bound Upper Bound
No Housing Problem 367 12.71 2.353 .123 12.47 12.95 4 16
One Housing Problem 264 11.97 2.588 .159 11.66 12.28 4 16
Two or More Housing
Problems
304 10.57 2.594 .149 10.28 10.86 4 16
Total 935 11.80 2.658 .087 11.63 11.97 4 16
Test of Homogeneity of Variances
Overall satisfaction, material well-being
Levene Statistic df1 df2 Sig.
2.109 2 932 .122
ANOVA
Overall satisfaction, material well-being
Sum of Squares df Mean Square F Sig.
Between Groups 771.072 2 385.536 61.674 .000
Within Groups 5826.111 932 6.251
Total 6597.183 934
Multiple Comparisons
Overall satisfaction, material well-being
Tukey HSD
(I) Housing Problems (J) Housing Problems Mean
Difference (I-J) Std. Error Sig.
95% Confidence Interval
Lower Bound Upper Bound
No Housing Problem One Housing Problem .739* .202 .001 .27 1.21
Two or More Housing
Problems
2.139* .194 .000 1.68 2.59
One Housing Problem No Housing Problem -.739* .202 .001 -1.21 -.27
Two or More Housing
Problems
1.401* .210 .000 .91 1.89
Two or More Housing
Problems
No Housing Problem -2.139* .194 .000 -2.59 -1.68
One Housing Problem -1.401* .210 .000 -1.89 -.91
*. The mean difference is significant at the 0.05 level.
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/1/23, 2:50 PM W5: Paradox of Thrift – ECON102 D005 Fall 2022
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Week 5 Discussion Post 4
An interesting paradox called the “Paradox of Thrift” arises when households
become concern about their future and attempt to increase their saving. As a
consequence of such action the overall economy will suffer. Explain. Do you
agree with this assessment?
Your initial discussion posts must be submitted by midnight, Day 3 and then your
responses to 2 of your classmates’ posts by have to be submitted by midnight,
Day 7.
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Week 5 Discussion post 4
Jonathan Malcolm posted Jan 1, 2023 3:07 PM Subscribe
Hello class,
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The paradox of thrift which is people gaining concern for the future so they look to save all
the money they can. This will definitely have a negative impact on the overall economy. If
you think about all the money you would be saving, that money is someone else’s lost
income. Small businesses would be suffering to stay afloat, and yes while you would be
keeping more money for yourself it would hurt the economy. I understand you can’t spend
everything you make, while that’s not good for yourself but not spending any of could even
go as far as causing these smaller businesses to go under and create rises in the
unemployment rates.
“John Maynard Keynes, who published his influential work, The General Theory of Employ –
ment, Interest, and Money, in 1936, noted saving can ultimately be detrimental to the
economy because of the paradox of thrift. This theory argues that if everyone individually
cuts spending to increase saving, aggregate saving will eventually fall because one person’s
spending is someone else’s income.”
This can also cause such a snowball effect because if I’m saving all my money, causing
others to lose out on income. They will in turn have to save their money to make up for the
lost income of me saving my money and so on and so on. Causing a much bigger effect on
the economy as a whole.
Vermann, E. Katarina. “‘Wait, Is Saving Good or Bad? the Paradox of Thrift.’” Economic
Research – Federal Reserve Bank of St. Louis, May 2012,
https://research.stlouisfed.org/publications/page1-econ/2012/05/01/wait-is-saving-good-
or-bad-the-paradox-of-thrift/.
-Jonathan
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Bernard Vinson posted Jan 1, 2023 10:57 AM Subscribe
Hello Class,
During the pandemic, people saved more money and had less credit card debt. Nearly $4
trillion was saved. (Frank, 2021) Saving money gives people a sense of comfort in knowing
they have money stashed away. With this comes the Paradox of thrift. This is when saving
https://research.stlouisfed.org/publications/page1-econ/2012/05/01/wait-is-saving-good-or-bad-the-paradox-of-thrift/
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more during an economic recession, leading to a fall in aggregate demand and economic
growth. Such a situation harms everyone as investments give lower returns than average.
(What Is Paradox of Thrift? Definition of Paradox of Thrift, Paradox of Thrift Meaning,
2022) Although a person decides to save or cut back on expenses from a particular
merchant, the money could go toward a different seller. For example, if I cut back on eating
out to save money for a vacation, the money will be saved but put towards other means in
return. The economy will not suffer from the Paradox of thrift because it allows people to
save money and spend it on wanted things with more money to do so, which in return will
grow the economy.
Reference:
Frank, R. (2021, August 4). Most of America’s extra savings during the pandemic are going
to the wealthy. CNBC. https://www.cnbc.com/2021/08/03/most-of-americas-extra-
pandemic-savings-are-going-to-the-wealthy-.html
What is Paradox Of Thrift? Definition of Paradox Of Thrift, Paradox Of Thrift Meaning.
(2022, December 27). The Economic Times.
https://economictimes.indiatimes.com/definition/paradox-of-thrift
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https://www.cnbc.com/2021/08/03/most-of-americas-extra-pandemic-savings-are-going-to-the-wealthy-.html
https://economictimes.indiatimes.com/definition/paradox-of-thrift
