withdrawals

Withdrawal

A transaction in which a customer receives back money he/she had previously deposited at a bank, pension, or trust. When one makes a withdrawal on a pension or similar plan, it may carry a penalty depending on the pension's rules. For example, one must usually be of a certain age in order to make a withdrawal. There is rarely such a penalty when making a withdrawal from a bank. For instance, when one closes an account, the client makes a withdrawal on all the money he/she owns at that bank.

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withdrawals

or

leakages

that part of NATIONAL INCOME not spent by households on the CONSUMPTION of domestically produced goods and services. In the basic CIRCULAR FLOW OF NATIONAL INCOME MODEL, all the income received by households is spent on current consumption. In the extended circular flow of income model, some of the income received by households is saved, some of it is taxed and some of it is spent on imported goods and services. Thus, SAVINGS, TAXATION and IMPORTS constitute withdrawals or leakages from the income-spending flow. Compare INJECTIONS. See also PROPENSITY TO SAVE, PROPENSITY TO TAXATION, PROPENSITY TO IMPORT.

Collins Dictionary of Economics, 4th ed. © C. Pass, B. Lowes, L. Davies 2005