Published Paper Details:

According to Engel's law, although total food spending may increase, the percentage of household income spent on food decreases. Using data on household consumption expenditures, this study investigates the applicability of Engel's law in the Indian setting. The study examines the relationship between total spending and food consumption across various income levels using regression analysis on NSS survey data. The results support Engel's hypothesis by confirming that households with higher incomes spend less on food. Furthermore, structural changes in consuming behaviour are highlighted by differences in spending patterns between the rural and urban sectors. The study sheds light on the changing demand for food and how it affects market dynamics and economic policy. In this paper, we aim to investigate whether the same relationship holds for rural and urban India across Indian States in 2023-24. In fact, the recent Survey on Household Consumption Expenditure (2023-24) made it possible to look into this issue. Thus, this study is based on both time series and cross-section analysis for finding out the relationship between the changes in share of monthly consumption expenditure on food items and the changes in Monthly Per Capita Consumption Expenditure (MPCE) in rural and urban areas across the major Indian States over time. This analysis focuses on both rural and urban areas across 18 major Indian states, namely Andhra Pradesh, Gujarat, Haryana, Karnataka, Bihar, Kerala, Madhya Pradesh, Maharashtra, Odisha, Punjab, Rajasthan, Tamil Nadu, Uttar Pradesh, Assam, Jharkhand, Chhattisgarh, Telangana and West Bengal, taking into account their diverse socio-economic and cultural contexts.