1. Per capita household consumption expenditure is the amount of income households spend for the consumption of various goods and services. It is calculated on the basis of market price of durable goods like cars, television, refrigerator, washing machine, etc.
Average per capita household consumption expenditure is calculated with the help of below mentioned formula.
Average per capita household consumption expenditure
= \(\frac{Country’s \,total \,household \,expenditure \,on \,various \,goods \,and \,services }{ Total\, population \,of\, the \,country }\)
2. Since, the per capita income of developing countries is lesser than the developed countries, the developing countries’ per capita household consumption expenditure is less than developed countries. This works as an indicator which indicatesthat developing countries are poorer.
the following table shows the per capita consumption expenditure of few countries:
Per Capita Consumption Expenditure (Per year)
| Countries |
Year 2014 (Based on fixed price of 2005 in US $) |
| US |
31,469 |
| UK |
25,828 |
| Japan |
22,149 |
| Pakistan |
603 |
| China |
1,420 |
| India |
725 |
Source: World Bank
Analysis:
As can be seen in the table, on an average an Indian spends very less as compared to developed countries like US, UK and Japan.
