The Magnitude of Household Consumption Expenditure

Abstract

The present study analyzed to investigate the change in the pattern of consumption expenditure across both in rural and urban areas Further the study estimated the linear regression to identify the causality between per capita income and consumption expenditure. The analysis of the study used the NSS data from 1993/94-2011-12. The results of the study revealed that the monthly per capita consumption expenditure has increased tremendously over the period of time. The variation in consumption expenditure among household types has narrowed down, agriculture labour in the rural areas and casual labour in the urban areas registered a remarkable growth particularly during the period 2004/05–2009/10. The analysis of data showed a further shift away from food to non-food items in all expenditure categories in both rural and urban areas. But in the case of agriculture labour In rural areas and casual labour in urban areas, the preference of food items in total consumption remains the same. This study also evidenced that the non-farm employment has played a greater role on increasing income levels in both rural and urban areas. The correlation coefficient results showed there was positive relation between household income and consumption expenditure in both rural and urban areas. It also observed from the results the raise in income could lead to change the dietary patterns.