CHAPTER FOUR

4. RESULT AND DISCUSSIONS

This chapter presented the analysis and interpretation of the study based on the collected primary
data using both descriptive and econometric analysis. In the first part of the analysis descriptive
statistics has been utilized. The categorical variables discussed based on percent and frequency
analysis of the data and the continuous variable summarized and discussed using maximum,
minimum, average (mean) and standard deviation values of the data. In econometric part of the
study the primary data has been analyzed and interpreted based on the utilization of Double
hurdle econometric model, the empirical result of Double hurdle model has been presented. The
regression results econometric model made possible with the help of using STATA.
4.1. Descriptive statistics results
Descriptive analysis is largely the study of distribution of one variable. This study provides us
with summary of the person and other subjects on any of a multiple of characteristics such as
size, composition, efficiency, preferences, etc.
As it was clearly indicated by table below Households with large number of dependents save less
however households with lower number of dependents save more. This means it increase to the
dependents, it is tough to fulfill the need of the family by single household head and their
consumption level is greater than saving

4.1 Household Characteristics of the Sampled Respondents participated

In this sub section, the general demographic and household characteristics of the sample
respondents are discussed vis-à-vis other descriptive statistics. Tables and figures are presented
to present relevant data of the household involved in the sample survey.
 Not participated in
saving, 42.97 %

Participated in
Saved, 57.03%

1participated in saving
0-Not participated
in saving

Source: Own computation from survey data (2024)

The data for this study contains 384 conveniently selected household of which only 57.03%
involved in saving (saving be it the formal or informal institutions) and the remaining 42.97%
not participate in saving practice of any type. The respondents saved amount in birr (Ethiopian
currency) runs between 0 to 40,000 birr with standard deviation 6430.075 birr and mean
monthly saved birr 4738.021.
The possible causes identified for low saving include high consumption expenditure, lack
of incentive to save, low income level, low current level of deposit interest rate, high
inflation, and having a negative personal saving habit and others.
 Table 4. 1 Profile of respondents for categorical variable

Variables Category Frequency Percentage (%)

Family size of households Family size 0-3 143 37.23
Family size 4-6 236 61.45
Family size>=7 5 1.32
Number Dependent Have Dependent 125 38.94
Have not Dependent 259 67.45
Male 183 47.66
Sex
Female 201 52.34
Educational attainment Primary educated 105 27.34
Secondary educated 116 30.21
Tertiary and above educated 163 42.45
Marital status Married 343 89.32
Single 41 10.68
Occupation status Government Employed 267 69.53

others 117 30.47

Saving habit of household Have saving habit 219 57.03

heads
Not have saving habit 165 42.97

Home ownership Have home 190 49.48

Note have home 194 50.52

Additional income Have Additional income 89 23.18

generating generating activities
activities Have not Additional 295 76.82
income generating activities

Source: Own computation from survey data (2024)

When we see the other categorical variable, marital status, more proportion of the sampled
respondents is leading by married household head and 343 respondents or (89.32percent) were
married and 41 respondents or (10.68 percent) of the respondent were single.
When we see occupational status of the household head, as categorical variable, from the sample
respondents 267 (69.53%) were government employed. The remaining 117 (30.47%) of
household heads engaged in self-employment,; private organization and engaged in NGO-
Employee.
The decision of households in order to engage in saving from their monthly income is
summarized in the above table 4.1 Accordingly among 384 observations of the household almost
by half of the respondents reported that they have saving account. About 219 respondents (57.03
percent of the household head) have their saving account; the remaining respondents of 165, the
sampled household of 42.97 percent reported that they have no saving account and they did no
save money from their monthly income. These respondents explained that the main reason for
that they do not save and confronted with is low level of their monthly income and higher
expenditure on consumption.
The respondents out of 384 observations 190 respondents or 49.48 percent are have their Own
home and the rest 194 or 50.52 percent of the respondents are households headed who don’t
have their Own home. This shows that in sampled households the higher proportion of the
households head haven’t their home .the households that have their own home save more than
that don’t have their own home.
The other categorical variable, Additional income generating activities, more proportion of the
sampled households don’t have Additional income generating activities and 89 respondents or
23.18 percent were have Additional income generating activities. The number of dependents on
household heads are from 384 observation 125 of the respondents or 38.94 percent of the
respondents have dependents the rest 67.45% don’t have no dependent. As the respondents
response the households that have large dependent save smaller than that households don’t have
dependents.
 Age of the household
>56
Age of the household 19-30
32 Age of the
8% household
75
20%

19-30
31-40
41-55
41-55 >56
Age of the household
144 31-40
38% Age of the household
133
35%

Source: Own computation from survey data (2024)

Figure 4.2 Age of Households
The following numbers of respondents with their percentage 32, (8%), 75 (20%) 133, (35%) and
144, (37%) of the respondents in the age group were between [19years and 30 years], [31 years
and 40 years], [41 years and 55 years], [greater than or equal to 56 years] old, respectively. 384
sample respondents for continuous variable. The Figure 4.2 Shows that for sample respondents‟
age structure of the observation falls between 19 and 69, the lowest age category is 19 and the
highest age of the respondent is 69. In the study area as the respondent’s response as age of
households heads age increase their extant of saving is tends to decline.