The change in household consumption patterns in Jordan: 1997–2017

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Abstract

This study aims to determine the change in consumption patterns of the Jordanian household during 1997–2017, as well as to estimate the income elasticities. The data from the household expenditure and income surveys conducted by the Jordanian Department of Statistics in the years: 1997, 2006, 2008, 2010, 2013, and 2017 were used. Graphs were prepared and percentages were calculated to measure changes in household consumption patterns. The average household expenditure index was used to measure the impact of income on changing consumption patterns (Selim, 2014). To estimate income elasticity, a pooled data regression model was adopted (Sugiarto & Wibowo, 2020). The estimated model is statistically significant at a level of 0.05. The study found a decrease in the percentage of household spending on the food group and an increase in the percentage of spending on the non-food group during the study period. This change in the family’s consumption pattern coincided with an increase in its income. Value of income elasticity was < 1 for food, clothing, and housing. It was > 1 for transportation and communication, education, and health. Therefore, we conclude that the consumer behavior of the Jordanian family is fully consistent with the theory of consumer behavior and its applications.

Keywords: Household Consumption, Engel Law, Income Elasticity, Jordanian Households, Pooled Panel Data

Authors’ individual contribution: The Author is responsible for all the contributions to the paper according to CRediT (Contributor Roles Taxonomy) standards.

Declaration of conflicting interests: The Author declares that there is no conflict of interest.

JEL Classification: C2, C8, D1, D6, D12, E2, G5, R2

Received: 30.11.2022
Accepted: 17.07.2023
Published online: 19.07.2023

How to cite this paper: Aljaloudi, J. (2023). The change in household consumption patterns in Jordan: 1997–2017. Journal of Governance & Regulation, 12(3), 81–89. https://doi.org/10.22495/jgrv12i3art9