{"id":321599,"date":"2024-12-30T19:17:39","date_gmt":"2024-12-30T13:47:39","guid":{"rendered":"https:\/\/forumias.com\/blog\/?p=321599"},"modified":"2024-12-31T11:51:21","modified_gmt":"2024-12-31T06:21:21","slug":"all-india-household-consumption-expenditure-survey-2022-23-explained-pointwise","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/all-india-household-consumption-expenditure-survey-2022-23-explained-pointwise\/","title":{"rendered":"Household Consumption Expenditure Survey 2023-24- Explained Pointwise"},"content":{"rendered":"

\"Household<\/p>\n

The Household Consumption Expenditure Survey 2023-24 was recently released by the Ministry of Statistics and Programme Implementation (MoSPI). The Survey highlights a rise in the share of spending on food in rural and urban households. However, non-food items continuing to dominate overall expenditure.<\/p>\n

All India Household Consumption Expenditure Survey (HCES), is a survey conducted by the NSSO every five years<\/span>, to ascertain the household spending habits. However, Govt had junked the last survey results of 2017-18, citing ‘data quality issues<\/span>‘. Post that, the survey methodology underwent a revision. Now, MoSPI has published back-to-back surveys<\/span> for 2022-23<\/span> and 2023-24<\/span> to check the robustness of revised methodology and stability of results for consumption expenditure.<\/p>\n\n\n\n\n
Table of Content<\/strong><\/td>\n<\/tr>\n
What is the All India Household Consumption Survey?<\/a>
\nWhat are the recent findings of the All India Household Consumption Survey?<\/a>
\nWhat is the significance of the All India Household Consumption Survey?<\/a>
\nWhat are the Challenges with the survey?<\/a>
\nWhat Should be the way forward?<\/a><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

<\/a>What is the All India Household Consumption Survey?<\/strong><\/span><\/h2>\n

1. About the Survey-<\/strong><\/span> The Household Consumption Expenditure Survey (HCES) is conducted to gauge household spending habits<\/span>. It provides crucial insights into household consumption patterns, their living standards and overall well-being.<\/p>\n

2. Interval of the Survey-<\/strong><\/span> It is a quinquennial survey<\/span> (recurring every five years<\/span>). It is conducted by the National Sample Survey Office (NSSO<\/span>), (which now comes under the National Statistical Office<\/span> in the MoSPI<\/span>).<\/p>\n

3. History of the Survey-<\/strong><\/span> The survey has been conducted every five years, since 1972-73<\/span>. The survey results were junked in 2017-18 due to ‘data quality issues’. Now, new surveys are being conducted in 2022-23 and 2023-24, according to new methodology.<\/p>\n

4. New Methodology-<\/strong><\/span> In the new methodology, several new features have been introduced-
\na. Segregation<\/span> of the consumption basket into three broad categories- food items<\/span>, consumables and services<\/span>, and durable goods<\/span>.
\nb. Inclusion of questions<\/span> seeking inputs on free items<\/span> and subsidies<\/span> under welfare schemes, such as food grains.<\/p>\n

<\/a>What are the recent findings of the All India Household Consumption Survey?<\/strong><\/span><\/h2>\n

1. Increase in Average Monthly Per Capita Consumption Expenditure (MPCE)<\/strong><\/span><\/p>\n

Significance-<\/strong> <\/span>An increase in the per capita expenditure of households indicates rising disposable incomes of households<\/span>, narrowing inequality<\/span> between rural and Urban areas, and declining poverty levels<\/span>.<\/p>\n

a.<\/span> Rural per capita consumption expenditure<\/span> has increased more sharply<\/span> as compared to urban expenditure<\/span> in the period from 2011-12 to 2022-23. Rural-urban consumption gap reduced to 69.7% in 2023-24, down from 71.2% in 2022-23 and 83.9% in 2011-12.
\nb. The average MPCE for rural households has increased to Rs. 4,122<\/span>. It has increased by 9.3%<\/span> from Rs 3,773 in 2022-23<\/span>. In 2011-12, the rural household MPCE was Rs 1,430.
\nc. The average MPCE for rural households has increased to Rs. 6,996<\/span>. There has been an increase of 8%<\/span> from Rs. 6,459 in 2022-23<\/span>. In 2011-12, the urban household MPCE was Rs 2,630.<\/p>\n

2. Dominance of Non-Food Expenditure in both Rural and Urban MPCE<\/strong><\/span><\/p>\n

Non-food items accounted for 53% of total expenditure in rural areas<\/span> and 60% in urban areas<\/span>. Major contributors of non-food expenditure includes conveyance, clothing, bedding and footwear, and entertainment.<\/p>\n

3. Increase in the share of Food Expenditure<\/strong><\/span><\/p>\n

Despite the dominance of non-food spending, the share of food expenditure increased slightly for both rural and urban households.
\na. For rural areas, the share of food expenditure has increased to 47.04% in 2023-24<\/span> from 46.38% in 2022-23<\/span>.
\nb. For urban areas, the share of food expenditure has increased to 39.68% in 2023-24<\/span> from 39.17% in 2022-23<\/span>.<\/p>\n

4. Narrowing Rural-Urban Gap in MPCE<\/strong><\/span><\/p>\n

The gap between rural and urban spending has decreased to approximately 70%<\/span>, down from 71% in 2022-23<\/span>. This indicates a stronger growth rate in rural consumption compared to urban areas.<\/p>\n

5. Regional Consumption Patterns<\/strong><\/span><\/p>\n

States in western, northern, and southern India<\/span>, including Maharashtra, Punjab, Tamil Nadu, Telangana, and Karnataka, have reported higher per capita spending than the national average<\/span>. In contrast, eastern and central states<\/span> like Bihar, Odisha, and Uttar Pradesh have recorded lower spending levels than the national average<\/span>.<\/p>\n

6. Gini Coefficient Decline suggests improvements in consumption equality<\/strong><\/p>\n

a. In Rural Areas- It fell from 0.283 in 2011-12 to 0.266 in 2022-23, and further to 0.237 in 2023-24.
\nb. In Urban Areas- It has declined from 0.363 in 2011-12 to 0.314 in 2022-23, and to 0.284 in 2023-24.<\/p>\n

The Gini coefficient, a measure of inequality, has shown a decline in both rural and urban sectors, suggesting improvements in consumption equality.<\/p>\n

<\/a>What is the significance of the All India Household Consumption Survey?<\/strong><\/span><\/h2>\n

1. Changing the weightage of components to accurately capture inflation-<\/strong> The consumption expenditure survey serves as a benchmark for assigning<\/span> and changing the weightage for different components of<\/span> Consumer Price Index (CPI)<\/span><\/span>. For ex-<\/strong> Lowering the weightage for food in CPI in accordance with the survey data.<\/p>\n

2. Macro analysis of the economy-<\/span><\/strong> The Household consumption expenditure<\/span> survey data is used by the economists to analyse the structural shifts in the Indian economy and take further measures, like rebasing the GDP<\/span> and the poverty levels<\/span>.<\/p>\n

3. Assessment of economic growth trends and inequalities-<\/strong>\u00a0The Household consumption expenditure survey indicates a narrowing gap in per capita<\/span> spending between rural and urban India. However, it also highlights the wide income gaps<\/span> within households, with the top 5% of households spending significantly more than the bottom 5%.<\/span><\/p>\n

4. Fine-tuning tool for Policymakers- <\/strong>The Imputed MPCE provides critical insights for policymakers to fine-tune social schemes<\/span> by understanding evolving consumer’s expenditure behaviour.<\/p>\n

5. Compass for the State governments-<\/strong> State governments can use the survey to reorient their budgetary strategies<\/span> to increase disposable incomes in the hands of people by learning from states like Tamil Nadu and Kerala.<\/p>\n

6. Fore-casting tool for the Industry-<\/strong> The survey provides the industries an insight into the changing consumer behaviour<\/span>, which helps them to refine their strategies and tap into emerging markets.<\/p>\n

<\/a>What are the Challenges with the survey?<\/strong><\/span><\/h2>\n

1. Small Data Set-<\/strong> The survey has covered 2.61 lakh households. This is a small sample size for a large and diverse country like India<\/span>.<\/p>\n

2. Temporal and Regional Variations-<\/strong> Incorporating accurate seasonal variations and regional disparities in household expenditure is another major challenge to obtain accurate survey results.<\/p>\n

3. Risks of Pent-up Demands-<\/strong> The survey has been conducted after two long years of COVID in 2020 and 2021. The year 2022<\/span> in which the survey was conducted has been a year of pent-up demand<\/span>, as the last two COVID years had witnessed suppressed demands.<\/p>\n

<\/a>What Should be the way forward?<\/span><\/strong><\/h2>\n

1. Putting the data to fine-tune the social programs-<\/strong><\/span> The All India consumption expenditure survey data must be used to fine tune various social security schemes like PM Garib Kalyan Anna Yojan<\/a>a, being run by the Govt by measuring their impact.<\/p>\n

2. Regularisation of the survey-<\/strong> The new survey methodology must be institutionalised at the earliest to establish the usual quinquennial survey cycle<\/span> (recurring every five years).<\/p>\n

3. Changes in the bases of Inflation Indices need to be awaited-<\/strong> Since the survey was conducted in a year of Pent-up demand, any changes to the weights of different parameters in the inflation indices based on the survey results will introduce significant bais<\/span>.<\/p>\n

An accurate, transparent, and comprehensive consumption expenditure survey data will help in shaping a more inclusive and equitable society.<\/p>\n\n\n\n
Read More- The Indian Express<\/a>
\nUPSC Syllabus- Indian Economy-GS 3<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n","protected":false},"excerpt":{"rendered":"

The Household Consumption Expenditure Survey 2023-24 was recently released by the Ministry of Statistics and Programme Implementation (MoSPI). The Survey highlights a rise in the share of spending on food in rural and urban households. However, non-food items continuing to dominate overall expenditure. All India Household Consumption Expenditure Survey (HCES), is a survey conducted by… Continue reading Household Consumption Expenditure Survey 2023-24- Explained Pointwise<\/span><\/a><\/p>\n","protected":false},"author":10357,"featured_media":321733,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[130,1],"tags":[],"class_list":["post-321599","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-7-pm","category-uncategorized","entry"],"jetpack_featured_media_url":"https:\/\/i0.wp.com\/forumias.com\/blog\/wp-content\/uploads\/2024\/12\/Household-Consumption-Expenditure-Survey-2023-24.png?fit=1280%2C853&ssl=1","views":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/321599","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/10357"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=321599"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/321599\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media\/321733"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=321599"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=321599"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=321599"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}