HOUSEHOLD - AN IMPORTANT INSTITUTIONAL UNIT
Authors: Virsaladze Naira 
Published: April 2021

Economy of the country represents the combination of resident institutional units (IU). A sector is created by grouping homogeneous institutional units. The household sector seems to be of great importance in the IU classification. Household as the main economic cell of a society is a group of people who are subject to common rules of cohabitation in one dwelling unit and are related to each other by a common budget (part of it), kinship and / or non-kinship relations, or both together.
The household sector differs significantly from other sectors in its functions and behavior.Households are both producers and consumers.However, in most cases, the scale of their production is small and includes activities necessary for their existence.Households are also involved in the accumulation process.The study of the household as the most important institutional sector is carried out by the National Statistics Office.The most important source for the study of the socio-economic situation of the population of the country is the material obtained from this study. It is a specially organized selective statistical observation, based on the data of which the size of the consumer basket of goods and services and the population are determined by a number of social characteristics.
The Household survey provides important statistical information on employment, agriculture, income-expenditure and livelihoods as a whole.It reflects the types and volume of income of the population from employment, assistance, pensions, gifts, dividends, loans, and etc. As a result expenses and their volume for housing, utilities, purchase of furniture, clothes and shoes, heating, health care, transport, food, local care in terms of agriculture and livestock, as well as revenues from the sale of livestock products have been also described in details.
According to official statistics, the income declared by households is constantly increasing in dynamics. The average monthly income of one household for 2019 was 1175.3 GEL, which is 382.2 GEL or 48% higher than the same indicator in 2012. While the average monthly income per capita increased from 222.2 GEL to 336.1 GEL. Revenues from hired labor are still characterized by a high share in the income structure. The share of the latter in cash revenues and transfers is 48.7%, while in total revenues it is 45.5%. It is important to note that income from hired labor in the 2012-2019 analysis period has almost doubled. But it must be said that the purchasing power of doubled wages amid the depreciation of the lari is so low that households today consume far fewer consumer goods and services than in 2012. It is also noteworthy that remittances from abroad have increased, which is also an indicator of the depreciation of the lari and the growth of external migration processes. As for the income from the sale of property is reduced by 3.7 times, which indicates that the population due to poverty and unemployment has exhausted the sale of property accumulated in the past and nothing is left for sale.
The amount of expenditure incurred by households as major consumers are directly reflected in the structure of GDP. The volume of expenditures on final consumption changes in parallel with GDP. In 2016-2019, this figure was 30,487.2 million. Increased from GEL to 41035.2 million, the growth rate was 134.6%. And household expenditures on final consumption 23 925, 4 mln. GEL 33,531.2 million has increased and the absolute increase amounted to 9 605.8 mln. GEL.
From the structure of household consumer expenditures it could be seen that a significant part of the expenditures is spent on the purchase of daily consumer goods and services. On average, the total expenditure of one household in 2019 increased by 248.7 GEL compared to 2012, and the consumer cash expenditure - by 269.1 GEL. Food, beverages and tobacco account for 37.8% of household cash expenditure. The share of expenditures on food, beverages and tobacco products is similar to 2012, which indicates that the physical volume of goods consumed did not increase, but rather increased costs due to rising prices for products.
Thus, official statistics from household surveys show that despite the increase in nominal incomes and expenditures, real incomes and expenditures decrease, household living standards fall sharply, remittances increase, and migration reaches dangerous levels for countries. In such conditions, the main task of the government is to identify the weaknesses in the economy at an early stage and take timely corrective measures. One of the main preconditions for this is an in-depth study and analysis of the socio-economic situation of households, which is primarily the prerogative of the National Statistics Office and analyst-statisticians.