The Anticipation of Expectations – Banks and the observation of household saving in West Germany and the United States

Prof. Dr. Jan-Otmar Hesse, Bayreuth (Principal Investigator)

Dr. Sebastian Knake, Bayreuth


German and US-American households differ significantly in the way they create financial wealth. This fundamental difference is the result of a rather recent historical development that started in the 1970s. Since the behaviour of households in both countries also differed from the predictions of the common economic models considering saving, economists failed to explain the difference and instead labelled them “saving puzzles”. The empirical observation becomes less puzzling, when households’ expectations and their impact on the saving behaviour are considered. In times of severe economic crisis households tend to fundamentally change their expectations and more generally the way they come to economic decisions. These periods of fundamental learning – so the concept introduced by Hansjörg Siegenthaler – also affected the saving behaviour of households and led to different paths to the formation of wealth in the US as opposed to the FRG. Yet, it is impossible to directly study the relevant expectations with conventional methods of formal quantitative economics. In contrast, our project explores expectations of households by analysing the efforts of financial institutions to anticipate them. Informed by the theoretical framework by John M. Keynes and Niklas Luhmann we start from the proposition that expectations relevant for households’ saving behaviour result from an interaction process between the savers and the relevant environment in which financial institutions are highly influential. Financial institutions are among the first to notice changes in the saving behaviour and they restructure their practices for anticipating expectations and finally come up with new saving products or different interest rate policies. This process of irritation and influencing finally leads to new cognitive rules that shape the formation of expectations among both participants of this interactive process. The assumption of the mutual influence of expectations between supply and demand on the markets for savings via the process of anticipation determines the way we conduct our research. The interaction process will be studied on the example of two connected cases in the US and in Germany in the 1970s and 1980s. The first example draws upon the different fate of the savings account. In the United States, households abandoned savings accounts in the 1980s, whereas in Germany it remained a major financial asset. The other example concerns the difference in the asset choice within employer-sponsored long-term savings plans. In the United States, the introduction of 401(k)-plans at the work-place since 1978 led to a significant increase in the rate of equity ownership among households. In Germany, a reform of the system of employment-based contributions to capital formation failed to achieve higher rates of equity owners, although this was the original goal of this reform. Our project relies on research within archives of financial institutions.



Hesse, Jan-Otmar: Financial crisis and the recurrence of economic nationalism, in: Journal of Modern European History, 19, 1 (2021), pp. 14-18.

Knake, Sebastian: The Spareckzins: The Making of Germany’s Most Important Price for Household Savings 1967–1983, in: VSWG Vierteljahrschrift für Sozial- und Wirtschaftsgeschichte, 110, 1 (April 2023), pp. 30-73.

Knake, Sebastian: The US market for savings deposits in econometric models and the market for econometric models among depository institutions, 1960s to 1980s, Working Papers of the Priority Programme 1859, No. 41 (2023),;jsessionid=0B0935FFE89BCE212502CD7EA6DED725.