Analysis of consumption decisions in developing countries has been a key part of IFS research since its beginnings, and relies on high quality and detailed survey data on households' spending and consumption patterns.
One strand of this work investigates the impact on consumption of policy interventions such as the conditional cash transfer programmes in operation in Colombia (Familias en Accion) and Mexico (Oportunidades), child health programmes in Malawi, and insurance programmes in India. A key aim of such programmes is to raise the living standards of low income households, and in some cases, to shift consumption to more beneficial goods (such as nutritious foods) and studying consumption patterns therefore forms an important aspect of evaluating such effects of these policies.
Another strand of work focuses on a more fundamental understanding of households' consumption decision processes. For instance, how do prices, incomes and demographics affect spending patterns? To what extent do substitution possibilities ameliorate the welfare impacts of price rises? What can we learn about the relative power of partners in a couple from household spending patterns?
A final strand of work investigates whether and how households smooth their consumption in response to idiosyncratic and aggregate shocks.