Vliv relativního příjmu na spotřebu domácností v České republice

Abstract

This work deals with the influence of relative income on household consumption by describing and explaining the variability of propensity to consume across income distribution. Mainstream consumption theory, although aware of this phenomenon, does not pay much attention to this due to its main focus on aggregate consumption. However, as the relative income hypothesis shows, this phenomenon can be quite easily and elegantly explained by interdependent consumption behaviour, which results in a functional relationship between the household’s propensity to consume and its position in income distribution, represented by relative income.

The aim of this work is to determine, describe and quantify the influence of relative income on household propensity to consume in the Czech Republic. This goal is primarily achieved by an econometric analysis of household consumption behaviour based on microdata from the Household Budget Survey. For the estimation of the dynamic panel data model we primarily use the First-Difference and System Generalized Method of Moments.

The results achieved unequivocally confirm the validity of the initial assumption that there is a functional dependence of the propensity to consume on relative income and thus fully support the idea of interdependent concept of utility and consumption. It can therefore be stated that the mainstream microeconomics distinguishes only between the income and the substitution effect. The relative income hypothesis, as well as the conclusions of this work, require a more detailed breakdown and to further distinguish between absolute and relative income effect.