CEREMONIAL SPENDING AND HOUSEHOLD DEBT

Abstract

This paper examines the relationship between ceremonial spending and household debt in Kazakhstan. More precisely, it investigates the impact of various household characteristics on the volume of ceremonial expenditure and explores the association between ceremonial spending and the incidence of household debt. The effect of a set of household characteristics on ceremonial spending is assessed using a log-linear regression, treating ceremonial expenditure as log per capita values, and using an ordered probit regression, treating ceremonial spending as a share from total household spending. The effect of ceremonial expenditure, as well as household characteristics, on household incidence of debt is then assessed using probit estimation. The study found that the household characteristics associated with age – the age of the head of the household and the mean age within it – influence the volume of ceremonial expenditure. Other factors affecting ceremonial spending were found to be the number of children and the number of elderly people in the household. Furthermore, household debt in Kazakhstan was found to be heavily influenced by the number of children in the household as well. This study contributes to future extensive empirical research on ceremonial spending in Kazakhstan, providing a base for empirical analysis.