Consumption
Origin
Middle English consumpcioun, from Latin consumption-, consumptio, from consumere. Wasting of the body (13th cent. or earlier in Anglo-Norman in a medical context; this sense is apparently not paralleled in continental French until much later (1559)), dissipation or reduction of moisture by evaporation (13th cent. or earlier in Anglo-Norman in a medical context; this sense is apparently not paralleled in continental French until later (1380)), destruction (late 13th cent. in Old French), wasting disease, especially pulmonary tuberculosis (a1365), in Anglo-Norman also act of consuming (food or drink). In post-classical Latin also destruction (Vulgate), death (5th cent. in Augustine)
Definitions
- 1a : a progressive wasting away of the body especially from pulmonary tuberculosis
- b : tuberculosis
- b : use by or exposure to a particular group or audience <the document was not intended for public consumption>
- 3: the utilization of economic goods in the satisfaction of wants or in the process of production resulting chiefly in their destruction, deterioration, or transformation
Description
Consumption is a common concept in economics, and gives rise to derived concepts such as consumer debt. Generally, consumption is defined in part by comparison to production. But the precise definition can vary because different schools of economists define production quite differently. According to mainstream economists, only the final purchase of goods and services by individuals constitutes consumption, while other types of expenditure — in particular, fixed investment, intermediate consumption and government spending — are placed in separate categories. See consumer choice. Other economists define consumption much more broadly, as the aggregate of all economic activity that does not entail the design, production and marketing of goods and services (e.g. the selection, adoption, use, disposal and recycling of goods and services).
Likewise, consumption can be measured by a variety of different ways such as energy in econometrics. The total consumer spending in an economy is generally calculated using the consumption function, a metric devised by John Maynard Keynes, which simply expresses consumption as a function of the aggregate disposable income. This metric essentially defines consumption as the part of disposable income that does not go into saving. But disposable income in turn can be defined in a number of ways - e.g. to include borrowed funds or expenditures from savings.
