Changes in Essential vs. Non-Essential Consumption During Inflationary Periods: A Household-Level Study.

Rachana Dattatray Kolape

doi:10.63363/aijfr.2025.v06i06.2066

Changes in Essential vs. Non-Essential Consumption During Inflationary Periods: A Household-Level Study.

Author(s)	Miss. Rachana Dattatray Kolape
Country	India
Abstract	Recent global and national inflationary pressures, particularly in the 2022-2025 period, have placed significant and acute strain on household budgets. This study investigates the impact of this inflation on consumption patterns within Pune District, Maharashtra, focusing on the trade-offs households are forced to make between essential and non-essential expenditures. The research aims to quantify these changes, identify primary coping mechanisms, and model the key determinants of consumption adjustments. A quantitative, cross-sectional survey design was employed, gathering data from 183 households (n=183) selected through a multi-stage sampling method. Data was analyzed using descriptive statistics, ANOVA, Pearson's correlation, Chi-Square, and multiple linear regression. The findings are stark. Results show a near-universal and significant cutback in non-essential expenditure (M=4.62 on a 5-point scale). A strong, positive correlation (r = 0.592, p < 0.001) was found between perceived financial strain and the severity of these cutbacks. More critically, a significant difference (p < 0.001) was identified between income groups regarding the impact on essential goods, with low-income households (M=4.22) reporting a severe decrease in the quality of essentials, compared to high-income groups (M=2.61). This indicates that while essential spending is protected, it is the quality that is sacrificed. Coping mechanisms are also heavily stratified by income (χ² = 17.22, p < 0.001), with lower-income groups resorting to debt, while higher-income groups utilize savings. A regression model confirmed that perceived strain (β = 0.45) and income level (β = -0.28) are the strongest predictors of non-essential cutbacks. The study concludes that households are actively managing inflation by sacrificing non-essential consumption, but this resilience masks a deeper and growing vulnerability in essential consumption for the poor, posing significant policy challenges.
Keywords	Inflation, Household Consumption, Essential Goods, Non-Essential Goods, Consumer Behavior, Pune, India, Coping Mechanisms, Financial Strain
Published In	Volume 6, Issue 6, November-December 2025
Published On	2025-11-15
DOI	https://doi.org/10.63363/aijfr.2025.v06i06.2066
Short DOI	https://doi.org/hbbz7x

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Changes in Essential vs. Non-Essential Consumption During Inflationary Periods: A Household-Level Study.

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