Examination of the relationship between economic growth and saving rate in low and high inflation countries

Determine the role of savings in investment and economic growth, including issues which have always been considered in formulating policy and economic theory and achieve high and stable economic growth rates of important issues in each country. On the other side of the main factors of inflation and its harmful effects (especially on economic growth) is also considered one of the main problems countries. The aim of this study is to analyze the relationship between savings and economic growth in countries with high inflation and low. The main objective of this study is to analyze the relationship between savings and economic growth in countries with high inflation and low. In other words, due to high inflation in developing countries, including Iran, This study tries to answer these questions that In terms of current inflation rate of national savings and economic growth How have changed And What is the relationship of these variables with each other by considering effect of inflation. We test the hypothesis that asserts an increase in the rate of inflation will cause the effect of saving on economic growth to decrease. To do this, a sample of developing countries including 67 countries over the time period 1995-2012 is chosen. When regressions are run in which economic growth is dependent variable and the rate of saving is independent variable for countries with low and high rates of inflation separately, the coefficient is higher for countries with lower rates of inflation. Also, we estimated the regression for all countries. Our empirical results show that the rate of inflation lowers the effect of the rate of saving. Therefore, the hypothesis is not rejected for the sample under study, implying that the rate of inflation lowers the effect of saving on economic growth. So the main hypothesis of this paper in the economy of developing countries, including Iran approved.