Saudi Journal of Economics and Finance (SJEF)
Volume-9 | Issue-10 | 404-412
Original Research Article
Determinants of Household Consumption: New Evidence from Selected Sub-Sahara Africa
Ernest Simeon Odior, Adedoyin Raphael Da-Silva, Ikechukwu Peter Nwele, Darlington Uzoma AKAM
Published : Oct. 6, 2025
Abstract
This paper investigates the macroeconomic determinants of household consumption in 37 Sub-Saharan African economies with annual time series from 2000 to 2023. The determinants include income, wealth, exchange rate, and population. Using a battery of econometric techniques, the result suggested the existence of a long-run relationship between the household consumption and its determinants. However, only income exerted positive and significant influence on household consumption in SSA countries. Therefore, the paper recommended that policymakers in the SSA countries should focus more on the improvement of households’ income base in the region. Also, since income is an important determinant of household consumption in the region, expansionary fiscal policies (such as public investment in infrastructure, tax incentives for businesses, and support for small and medium-sized enterprises (SMEs)) should be aimed at, so as to increase employment opportunities, income and wealth creation.