Econometric analysis of consumption expenditure example of the city of Usak

Consumption expenditure is one of the important matters the economic theory examines. Economists have started to attach importance on consumption after Keynes. After Keynes? introduction of the Absolute Income Hypothesis, several other hypothesis, intended for explaining the income - consumption relation, have been set forth.In this paper, where the household consumption expenditures in the city of Usak has been taken as subject, the consumption patterns of the households living in the central urban area of the city of Usak have been analysed. The data obtained from the ?City of Usak Household Consumption Expenditures Questionnaire?, which was applied through face to face interview method with the sampling universe, have been used in the paper.The primary purpose of this paper is to test the income hypothesis of consumption for the households living in the urban areas of City of Usak, and to determine the most convenient model. Calculating the flexibility values of consumption groups and examining the applicability of Engel?s Law are the other purposes of the paper.Keywords: Consumption Expenditures, Income Hypothesis, Consumption Flexibility, Engel?s Law