The Econometric Analysis of Student Expenditures: A Case Study of Amasya Univesity

Abstract

(ProQuest: ... denotes formulae omitted.)1.IntroductionThe economics trying to meet the unlimited needs of people with limited sources always takes a close interest in how to provide the utility maximization of the consumer under budgetary savings. Such that, consumption and consumption function are one of the basic subjects of microeconomics. In many studies, while consumption function and hypotheses were investigated, income-consumption behaviors for countries or cities were searched in some studies (Altunoz, 2014). Consumption function reveals the mathematical relation between consumption expenditures and income, and meanwhile, it is one of the important indicators in savings in an economy. The marginal propensity to consume of the consumers with different income groups will be also different, which shows that the consumption is essentially based on income. However, it must be stated that in addition to income, such factors as wealth, enjoyment and preferences, price, age, gender, etc. are effective in consumption expenditures. By doing consumption expenditures, individuals not only satisfy their own needs but also increase the income of the producer towards the product group they have consumed. In this aspect, the consumption concerns both the consumers and producers.As higher education institutions, universities, in addition to being institutions where scientific studies are done and shared, are consumption units with undeniable benefits to economic and social structure of the regions thanks to significant contribution to expenditures and employment. These benefits range far in terms of both social-cultural and economic, and they are integrated into daily life (David, 2003: 9).In this context, the purpose of the study is to examine the consumption expenditures of university students and to investigate whether these expenditures are related to socio-demographic factors. The fact that there was no such kind of study in the literature about Amasya University students motivated us to work on this issue.In this study, whose aim is to reveal the consumption expenditures of the university students and to investigate whether these expenditures are in relation with socio-demographic factors or not, in the pursuit of introduction chapter, the theoretical framework of the investigation was formed by stating consumption theories available in economic literature. And then, the studies done in both Turkey and the world were revealed by making literature review. Finally, the results obtained through analysis and findings were evaluated.2.Theoretical FrameworkConsumption expenditure not only exhibits the utility maximization of the individual, it is also one of the important components of effective demand needed to reveal macro magnitude like employment and national income. In this sense, the consumption expenditures were discussed from macro point of view for the first time by Keynes in his General Theory (1936) work. According to Keynes' Absolute Income Hypothesis, the consumption expenditures are a function of current income.Keynes' consumption theory can be expressed as functional as follows,... (1)The meanings of the symbols in the Equation1are given below:C= Total consumption expendituresY= Current disposable income ( c0and cx fixed, 0 C0 = Autonomous consumption expendituresc1 = Marginal propensity to consumeKeynes asserts that individuals minimally consume by means of solving their savings or borrowing even in the periods without income. According to Keynes, average of the consumption propensity of the individuals (C/Y) decreases upon the rise in income. Consumption expenditures are stable in spite of the instability of income, and marginal propensity to consumption and marginal saving propensity take fixed value. According to Keynes, when the disposable individual income increases, consumption as well increases; however, when disposable income increases, consumption increases higher than income. …