Vol. 5 No. 1 (2022): An Analysis on Variation of Consumer Demand and Expenditure Structure of Zambian Residents-Based on Extended Linear Expenditure System Model (ELES) | Horn of African Journal of Business and Economics (HAJBE)

About this Issue

The purpose of this study is to assess the variations of consumer demand and consumer expenditure structure using the ELES model in Zambia. It evaluates expenditure elasticity, price elasticity and household demand consumption patterns. The study used 2019 household survey data, conducted in two provinces of Zambia, that is, Southern and Northern Provinces. The results indicate that all estimated commodities are price inelastic as the minimum required quantity is positive. This entails that the estimated commodities have no effective substitutes. Thus, the rate of variation in the quantity demanded is less than that of a change in the price. The demand for food, health expenses, education, clothes, and housing are relatively inelastic and these commodities are gross complement. Therefore, these commodities are ideal in the consumer’s budget share and their consumption is legitimately subtle to income variations. These findings are suitable for developing countries like Zambia in understanding the effect of price and income variations on consumer expenditure structure.

Published 2022-07-20

Full Issue

PDF Download

About us

Find us on

Ju Location