Comparison of Changes in Consumption Distribution in the Rural and Urban Areas of Iran

Consumption of goods and services by households is an important index of their level of economic welfare. State of consumption distribution among households is an important index of equity in economic welfare. In this research, two important dimensions of consumption distribution have been studied: 1) Trend of changes of consumption distribution between Iranian rural and urban households 2) Changes of consumption distribution among households within rural and urban areas in different provinces. Secondary data were used in this research from rural and urban households surveys of expenditure and income for different years. The results show that the ratio of urban household expenditures over rural household expenditures during 1965-96 has had a decreasing trend, though the gap is still high. To compare consumption expenditure distribution changes within rural and urban areas in different provinces, the data for the two years of 1986 and 1996 have been used. The results show that countrywide the Gini coefficients in 1986 and 1996 in rural areas were higher than those in urban areas in rural areas the coefficients were 0.458 and 0.421 and in urban areas 0.430 and 0.403, respectively, which indicate a decrease of 8.08 and 6.28 percent, respectively. Among the rural areas of 24 provinces, the Gini coefficients of 9 provinces increased and those of 15 provinces decreased from 1986 to 1996. This is while the comparison for the urban areas in the same provinces and for the same period indicates that the Gini coefficient of 6 provinces increased but that of 17 provinces decreased. No change occurred in the case of Tehran Province.