International Congress on Eurasian Economies

International Conference on Eurasian Economies

17-18 September 2013 – St. Petersburg, RUSSIA

Paper detail

Paper ID : 709
Status : Paper published
Language : Turkish
Topic : Growth and Development
Presenter: Prof. Dr. Seda Şengül
Session : 1B Büyüme ve Gelişme

The Consumption Expenditure of Households in Turkey: Demand System Estimation with Pseudo Panel Data
Türkiye’de Hanehalkı Tüketim Harcamaları: Pseudo Panel Veri ile Talep Sisteminin Tahmini

Abstract

In this study, micro data sets obtained by 2005 and 2009 Household Budget Surveys compiled by Turkish Statistical Institute were used to estimate the parameters of household consumption demand and calculate the income-demand elasticities of consumer goods. Total expenditures of the households in this data set delivered into the following 12 different categories of goods and services. The expenditure share of these different categories of goods and services is the dependent variable of this model. In addition, the total household expenditure, the squared total household expenditure, the household size adjusted in accordance with the OECD equivalence scale and the logarithms of squared household size are the independent variables used in the study. The Seemingly Unrelated Regression Equations (SURE) is used to estimate the Quadratic Almost Ideal Demand System (QAIDS) so as to determine the demand parameters of the main commodity groups. The principal result of the study is that the consumption elasticities of the food and nonalcoholic beverages, housing, water, electricity, fuel, clothing and footwear, furniture and house appliances, communications, alcoholic beverages, cigarette and tobacco expenditure are less than 1. Therefore, it can be said that these commodity groups are considered to be mandatory goods. On the other hand, the consumption elasticities of the health, transportation, education services, entertainment and culture, restaurants, hotels, patisseries are more than 1. Thus, these commodity groups are considered to be luxury goods. In this regard, the study concludes that Turkey is considered to be a developing country in terms of the consumption characteristics.

JEL codes: D12, C23

Şengül, Seda, Sigeze, Çiler (2013). "The Consumption Expenditure of Households in Turkey: Demand System Estimation with Pseudo Panel Data" in Proceedings of International Conference of Eurasian Economies 2013, pp.279-288, St. Petersburg, RUSSIA.

DOI: https://doi.org/10.36880/C04.00709

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Session 1B: Büyüme ve Gelişme

Istanbul Beykent University Turkish Central Bank TIKA