What is household final consumption expenditure
HFCE or Household final consumption expenditure is a measurement of a countries accounts based on consumer spending. It is based on the amount that individuals or households spend each quarter, or each year, on every type of goods and services.
It does not just look at regular households of two adults and two children; it also looks at other types of living such as single people, or those living in communal groups such as retirement homes.
It does not just concentrate on major commodities but includes everything that is purchased. HFCE looks at items such as the cost of renting or mortgage payments on homes.
HFCE is basically a measurement of the actual average price paid by purchasers for a huge variety of goods and services, it includes all taxes that have been added to the costs and even takes into account other more invisible expenditure such as the amount spent tipping at restaurants.
It takes into account everyday purchases such as food and clothing. Also included are semi-regular payments such as tickets for entertainment events, there are also very occasional payments made to the government such as the fee for issuing passports.
The list is endless but when calculated together it gives an indication of the average expenditure of individuals and households.
