What Is a Consumer Economy?

Consumption is an important and final link in the process of social reproduction. It refers to the process of using social products to meet people's various needs. Consumption is divided into production consumption and personal consumption. The former refers to the use and consumption of production materials and living labor in the production process of material materials. The latter refers to the behavior and process by which people use the produced material information and spiritual products to meet the needs of personal life, and is "executive of life functions outside the production process". It is an indispensable condition for restoring people's labor and labor reproduction.

consumption

(Economic term)

Consumption is divided into
Before the 1930s, research on consumption theory was relatively simple. The orthodox theory that prevailed at the time was Marshall's theory of demand. The main point of this demand theory is: assuming that the consumer's income is unchanged, the quantity of goods obtained by the consumer changes in the opposite direction according to the rise and fall of the price. The Engel coefficient is an important measure of the level of consumption
Consumer psychology is an important branch of psychology. It studies the psychological phenomena and behavioral rules of consumers in consumer activities.
The first is the plan type, which is based on the actual situation of family income and husband and wife life goals. Consumption is generally carried out according to the plan. It is very sane and rarely blind and surprise consumption.
The second is casual type. This type of person consumes completely according to personal preferences and temporary interests, and less consideration of overall consumption benefits.
Engel coefficient
Engel coefficient
The Engel coefficient is an important factor for measuring the level of consumption. The Engel coefficient is actually: the proportion of total food expenditure to total personal consumption expenditure. The formula is: (food expenditure / personal (family or country) total consumption expenditure) * 100%. Yep
consumption
The higher the Gelger coefficient, the poorer it is, and the lower the Engel coefficient, the richer it is. The Engel coefficient above 59% is poverty, 50-59% is food and clothing, 40-50% is well-off, 30-40% is rich, and less than 30% is the richest.
Consumption index
Consumer price index (English name: consumer price index abbreviation: CPI) for short refers to the consumer index, which refers to an index measuring the purchase price of a selected basket of consumer goods. When calculating the index,
The weight of each commodity is determined based on the share of the commodity in urban consumer living expenses from 1982 to 1984. It is an indicator of price changes that reflects the prices of products and services related to residents' lives, and is usually used as an important indicator for observing the level of inflation. If the consumer price index rises too much, it means that inflation has become a factor of economic instability, and the central bank will have the risk of tightening monetary and fiscal policies, resulting in uncertain economic prospects. Therefore, the excessive increase of the index is often not welcomed by the market. For example, in the 12 months of 2008, the consumer price index increased by 2.3%, which means that the cost of living rose by an average of 2.3% compared to 12 months ago. As the cost of living increases, the value of your money decreases. In other words, a 100 yuan note received a year ago can only buy goods and services worth 97.70 yuan today. Generally speaking, when CPI> 3% increase, we call INFLATION, which means inflation; and when CPI> 5% increase, we call him SERIOUS INFLATION, which means severe inflation.
The Consumer Price Index (CPI, Consumer Price Index) is an index generally compiled by countries around the world. It can be used to analyze the basic dynamics of market prices and is an important basis for the government to formulate price and wage policies.

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