HOUSEHOLD CONSUMPTION EXPENDITURE SURVEY 2022-23
- The Household Consumption Expenditure Survey (HCES) 2022-23 was conducted by the National Sample Survey Office (NSSO) under the Ministry of Statistics and Programme Implementation (MoSPI) in India. It aimed to gather data on the spending patterns of households across the country
- The Household Consumption Expenditure Survey is typically conducted by the National Sample Survey Office (NSSO) in India. This survey is crucial for understanding the consumption patterns and expenditure habits of households, providing valuable insights into the economic conditions and trends.
- The HCES collects data on various aspects of household expenditures, including food, education, healthcare, housing, and more. It is an essential tool for policymakers, researchers, and economists to analyse and formulate strategies related to economic development and social welfare.
2.1. Statistics
- Data from the Household Consumer Expenditure Survey (HCES), conducted by the National Sample Survey Office (NSSO), indicates a decline in the percentage of food expenditure in the average monthly per capita consumption expenditure (MPCE) for both rural and urban India.
- In rural areas, the share of food in MPCE decreased from 52.9% in 2011-12, 53.1% in 2004-05, and 59.4% in 1999-2000 to 46.4% in 2022-23.
- Similarly, in urban areas, although the drop was not as pronounced, there was still a decrease from 48.1% in 1999-2000 to 40.5% in 2004-05, 42.6% in 2011-12, and 39.2% in 2022-23
- Reducing spending on food as a proportion of your overall consumption allows for more financial resources to be allocated to various other areas, including consumer durables, clothing, footwear, fuel for transportation, and entertainment. In simpler terms, it opens up the possibility to aspire for a broader range of goods and experiences.
- From the 1999-2000 National Sample Survey 55th round to 2022-23, the proportion of expenditure on food has gradually decreased for both urban and rural households. Notably, it is the first instance where spending on food has dropped below 50% of the total consumption expenditure in rural India and below 40% in urban India, marking a significant shift.
- In 1999-2000, the share of food in consumption expenditure in rural India was as high as 59.4%, remaining around 50% during the first decade of the new millennium. However, in 2022-23, it reached 46.38%. In urban India, the share of food in the average monthly per capita consumption expenditure (MPCE) has declined to 39.17% in 2022-23 from 48.06% in 1999-2000
Monthly Per Capita Consumer Expenditure (MPCE) is a metric that measures the average spending per person in a household over a specified period, usually a month. It is a key indicator used in economic surveys and studies to assess the patterns of household consumption and expenditure.
Here's a breakdown of the components:
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Monthly: The expenditure is calculated over a monthly timeframe. This allows for a regular and standardized measurement of consumer spending.
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Per Capita: The total household expenditure is divided by the number of individuals in the household to arrive at the per capita expenditure. This normalization accounts for variations in household size, providing a more accurate representation of spending on an individual basis.
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Consumer Expenditure: This includes the total spending on various goods and services by members of a household. Consumer expenditure encompasses a wide range of items such as food, housing, education, healthcare, transportation, entertainment, and more.
MPCE is a crucial parameter for understanding the economic well-being and consumption patterns of households. It helps policymakers, researchers, and economists analyze trends in consumer behavior, identify changes in spending patterns over time, and assess the impact of economic policies on households.
The data on MPCE is often collected through household surveys, such as the National Sample Survey in India, where respondents are asked to provide details about their expenditures across different categories. This information is then aggregated and analyzed to draw conclusions about the economic conditions of the population
5.Way Forward
The Consumer Price Index (CPI)-based inflation, also called retail inflation, is currently based on a basket that was decided in 2012. But over the last 11 years, as the latest Household Consumption Expenditure (HCE) Survey 2022-23 shows, a lot has changed.
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Source: Indianexpress
