An Analysis of the Determinants of Household Income Expenditure, Case Study of Lusaka Urban in 2025
DOI:
https://doi.org/10.59413/ajocs/v7.i2.52Keywords:
Disposable Income, Family size, Cross-sectional data, Determinants, Household Income expenditureAbstract
Abstract—The study of factors determining the Household Income Consumption over time by different fields of scientific knowledge. In this study, a balanced cross-sectional data set of Zambian Households was used for examining the determinants of Household Income Consumption in Lusaka Province. For this purpose, 60 observations which are 60 Households in 2025 were included. Non-poor households display significantly higher expenditures than poor and extremely poor counterparts. Recognizing the importance of location and employment sectors is crucial for targeted economic development in both urban and rural areas. Household Income Consumption is considered as a dependent variable whereas family size, disposable Income, saving levels, and consumption patterns are considered as independent variables. An analysis of variance (ANOVA) was applied to examine the relationship between household size and Household Income Consumption. Regression analysis with linear, multiple regressions and fitting were used to determine the relationship between consumer spending and the four independent variables. The results analyzed the correlations and test the hypothesis of a significant difference in the types of consumption expenditure about different four independent variables. Results confirm the significant impact of only two independent variables, (disposable income, and family size) were statistically significant of a positive relationship with consumption expenditure in Lusaka. The global rise in wage income and Household Income Consumption has been an important topic in labour economics over the past few decades. Many studies have been undertaken to ascertain the factors affecting Household Income Consumption. However, little research exists for Zambia on this topic, especially in the Private Microfinance sector, despite the importance that is attached to labour matters in successive governments in the country. Thus, the study sought to establish the determinants of Household Income Consumption in Zambia. The study employed the data via primary sources from Lusaka Province to complete this analysis with a sample size of 60 Household respondents. Consumption has been rising, especially due to the interest rates across sectors in the economy with Household Income Consumption high. The study thus established that education exerts the largest influence on Household Income Consumption while gender and the regional location of workers also play a significant (though diminishing) role. The study recommends an increased saving culture through investments in human capital to catch up with the rise in demand for skilled labour if Household Income Consumption is to be reduced in Zambia.
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