Household final consumption expenditure distributional accounts: Harmonising macro and micro data

Abstract

Well-being is a multidimensional concept including income, consumption and wealth and their measures are crucial to the design of economic and social policies. Aggregate measures and average values fail to capture the disparities existing among different types of households, which remain far from homogeneous.

Average values are meaningful statistics, but they do not tell the whole story about living standards.

The reconciliation of micro and macro data on households is essential. Micro data sources,  can provide distributional information among households but they may not be consistent across the primary components of economic well-being and may not be comparable across countries. In contrast, the system of National Accounts provides comprehensive, consistent and internationally comparable information but it cannot provide any evidence on distribution of economic resources among groups of households.

To bridge macro and micro data, National Accounts values can be combined with distributional indicators from micro data sources, carefully accounting for potential differences in definitions and concepts between macro and micro aggregates.

This paper aims to harmonise micro and macro data as a first step toward developing experimental distributional estimates for household consumption, based on National Accounts data as well as on survey data for consumption (HBS).