Consumption Quote by Axel Kaiser
““the only way in which a whole country may save is by reducing its consumption. Consumption is therefore the destruction of wealth, whereas savings makes it possible to multiply it. Let us take a similar example to that given by the great Austrian economist, Eugen von Böhm-Bawerk, to illustrate how underconsumption —savings— is what permits the formation of the so-called “capital goods”, which are so necessary to increase productivity as well as future consumption.[12]””
About This Quote
Source Book: Economic Thought, Axel Kaiser, 2022
Reducing national consumption and increasing savings enables investment in capital goods, which boosts productivity and future consumption.
In simple terms: Saving funds investment, which grows wealth and future consumption.
Key Takeaway
Invest and to build future wealth.
Themes
economics
investment
productivity
consumption
capital formation
Mood
analytical
concerned
Type
economic
policy
analytical
When to use this quote
- government budgeting
- personal finance
- business planning
- policy making
- economic forecasting
Key Concepts
savings
capital goods
underconsumption
investment cycle
Questions to Reflect On
- How can societies balance consumption and saving?
- What policies ensure savings translate into productive capital?
A Different Perspective
Savings alone cannot guarantee equitable growth without proper distribution.
![“Inappropriate macro economic policies in some economies, characterised by [a] low savings rate and high consumption [and] failure of financial supervision and regulation to keep up with innovation which allowed financial derivatives to spread.” quote by Wen Jiabao](https://sms4smile.com/quotes/img-quotes/8a3/wen-jiabao-24155_consumption_inappropriate-macro-economic-policies-in_572641.jpg)
