What is marginal saving?

Marginal saving refers to the additional amount of saving that results from an increase in income or a change in consumption behavior. It represents the change in savings when a household or individual decides to save a portion of an additional dollar earned, rather than spending it all. This concept is closely related to marginal propensity to save (MPS), which measures the fraction of additional income that is saved. Understanding marginal saving helps in analyzing consumer behavior and the overall economy's savings rate.