Journal of Business & Economic Policy

Household Consumption Expenditure in Albania
PhD Candidate Eri Gjoka

Abstract
Household consumption expenditure are an important indicator of well-being and standard of living of individuals. Often consumption spending, rather than income levels, are used to assess the country's monetary poverty. Household’s total expenditure and spending decisions are affected by various factors such as size of the household, income, education level, gender and age of the head of the household, location, status and occupation. At this paper we estimated a consumption expenditure model, trying to identify the determinants of household consumption expenditure. Separated models were fit for urban and rural areas. Education and employment of head of the household, as well as that of other members of the household do boost consumption expenses. The size of the household shows an inverted U shape relation; expenditures are larger in larger households but decrease in very large ones. In urban areas, having a computer and internet connection also matters.

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