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Where Does All the Money Go: Shifts in Household Spending Over the Past 30 Years

Brookings – Shifts in Household Spending Over the Past 30 Years, Jun 2016.

“Economic progress occurs unevenly, diffusely, and at times unpredictably: whole categories of spending diminish or grow as technology and preferences shift. For instance, as the relative price of clothing has plummeted, the share of spending going to clothing has declined; at the same time, health care has become more expensive and it has increased as a share of total spending. This economic analysis describes shifts in consumer spending patterns over the last thirty years, and how the experiences of low-income households have differed from higher-income households. We show that low-income households today spend a higher share of their budgets on basic needs—defined as the major budget components of housing, food, transportation, health care, and clothing—than they did three decades ago..”

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