Determinants of Household Consumption Expenditures in Asian Countries: a Sectoral Differences Analysis

The objective of this article is to quantitatively assess the differences in the influence of key socio-economic determinants on household consumption of various categories of goods and services across Asian countries: 1) Food, beverages, and pharmaceuticals; 2) Clothing and footwear; 3) Furniture and household appliances; 4) Transport and communication; 5) Education; 6) Healthcare; 7) Other categories; and 8) Total consumption (all categories of goods and services). The methodological framework based on a fixed effects regression model applied to a panel dataset covering eight major consumer markets in Asia over the period from 1991 to 2023. The results show that food-related expenditures are the least sensitive to income changes, while spending on education and healthcare is the most income-elastic, reflecting their perception as strategic investments. Clothing and footwear demonstrate moderately high income elasticity, whereas expenditures on furniture, appliances, transport, and communication show medium elasticity, largely dependent on household savings and access to credit. Financial sector development significantly enhances consumption in the areas of transport, communication, education, and healthcare. Inflation stimulates spending on clothing and footwear but tends to constrain expenditures on social services. Demographic factors also play an important role: a higher share of women encourages more diverse and higher-quality food consumption, but is associated with lower spending on education and healthcare. Countries with a growing working-age population exhibit the greatest potential for expanding expenditures on education and healthcare.