Personal Consumption Expenditures (PCE)
Personal Consumption Expenditures (PCE) is a measure of the total spending by households on goods and services. It is a key component of the Gross Domestic Product (GDP) and is used to measure the health of the economy. PCE includes spending on durable goods, such as cars and furniture, as well as non-durable goods, such as food and clothing. It also includes spending on services, such as medical care, education, and entertainment. PCE is an important indicator of consumer confidence and economic activity.
History of Personal Consumption Expenditures (PCE)
PCE has been used as a measure of economic activity since the early 20th century. It was first used by the U.S. Department of Commerce in the 1920s to measure the total spending by households on goods and services. Since then, it has become an important indicator of economic activity and consumer confidence. PCE is used by governments, businesses, and economists to measure the health of the economy and to make decisions about economic policy.
Comparison of Personal Consumption Expenditures (PCE)
| Category | PCE | GDP |
|---|---|---|
| Measurement | Total spending by households on goods and services | Total value of goods and services produced in an economy |
| Components | Durable and non-durable goods, services | Consumption, investment, government spending, net exports |
| Uses | Measuring consumer confidence and economic activity | Measuring economic growth and health of an economy |
Summary of Personal Consumption Expenditures (PCE)
Personal Consumption Expenditures (PCE) is a measure of the total spending by households on goods and services. It is an important indicator of consumer confidence and economic activity, and is used by governments, businesses, and economists to measure the health of the economy and to make decisions about economic policy. For more information about PCE, you can visit the U.S. Bureau of Economic Analysis website or the Federal Reserve Bank of St. Louis website.
See Also
- Gross Domestic Product (GDP)
- Consumer Price Index (CPI)
- Gross National Product (GNP)
- Gross Private Domestic Investment (GPDI)
- Gross National Savings (GNS)
- Gross Fixed Capital Formation (GFCF)
- Net Exports (NX)
- Government Consumption Expenditures and Gross Investment (GCEGI)
- Personal Income (PI)
- Disposable Personal Income (DPI)
