Inflationary pressure on households

Authors: Ragchaasuren Galindev, Tsolmon Baatarzorig

Source: Economic research institute

Keywords: Consumer price index, consumption, consumption shares of goods and services

Date: 2015-02-01

This paper examines the effects of price inflation on households by processing the Household Socio-Economic Survey data conducted by the National Statistical Office of Mongolia. Using the standard methods, we calculate the monthly, annual and cumulative CPI inflation rates for individual households and consumption quintiles between 2009 and 2012. It is found that monthly CPIs were volatile due to seasonal changes in the prices of goods such as meat, milk products and vegetables. Households with high consumption share of food items faced with lower price inflation in the summer months relative to those with high non-food consumption shares, but higher price inflation in the other months. Although there were differences in the rates of monthly and annual inflation rates across households, the cumulative general inflation rate over the four year were more or less the same across the households representing quintiles. It also studies the real consumption of representative households of quintiles which grew at rather questionable rates over the period.

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