DURABLE GOODS CONSUMPTION AS AN INDICATOR OF ECONOMIC PROGRESS IN UZBEKISTAN (2017–2024)

INTERNATIONAL SYMPOSIUM “ADVANCED RESEARCH IN ECONOMICS AND BUSINESS MANAGEMENT”, SEPTEMBER 19, 2025 435 DURABLE GOODS CONSUMPTION AS AN INDICATOR OF ECONOMIC PROGRESS IN UZBEKISTAN (2017–2024) Jumanov Abrorjon Nuridin O‘g‘li Leading specialist, Institute for Macroeconomic and Regional Research under The Cabinet of Ministers E-mail: [email protected] https://doi.org/10.5281/zenodo.17266865 Abstract: Durable goods – long-lasting items like appliances, electronics, and vehicles – aлиre more than conveniences; they are tangible indicators of a population’s living standards and economic well-being. In developing economies, rising ownership of durables often accompanies income growth and poverty reduction, reflecting improved household welfare. In economics it frequently uses household asset ownership (including durable goods) as a proxy for wealth in welfare studies. A higher prevalence of items such as refrigerators, washing machines, automobiles, and smartphones in homes signals that basic needs are met and discretionary spending is increasing, consistent with a broader transition up the development ladder. Conversely, limited access to durables can indicate constraints in household finances or unequal distribution of economic gains. Thus, tracking durable goods consumption provides insight into the quality of life and the inclusiveness of economic progress. This thesis examines how Uzbekistan’s consumption of durable goods from 2017 to 2024 reflects its economic development trajectory. Keywords: durable goods; living standards; economic development; asset ownership; consumption patterns; composite (integral) index Theoretical Foundations of Consumption and Durable Goods Economic theories of consumption provide a framework for understanding why durable goods ownership rises with development. Keynesian consumption theory posits that income is the primary determinant of consumption. John Maynard Keynes observed that as national income grows, consumer spending grows as well, though not always proportionally [1]. Engel’s law specifically addresses how consumption patterns change with income: as household income increases, the proportion of income spent on food declines, while the share spent on non-food items (including durable goods) increases [2]. For example, in China the Engel’s coefficient (food share of expenditure) fell from about 64% in 1978 to 29.8% by 2023 [3]. The life-cycle hypothesis (Modigliani & Brumberg) further enriches our understanding by considering how consumption and saving behavior vary over an individual’s lifetime. This suggests that middleaged households (at peak earnings) are more likely to purchase big-ticket items like cars or home appliances. Uzbekistan’s youthful population entering family formation stages in the 2010s and 2020s has indeed driven purchases of appliances, electronics, and personal vehicles. These theories predict that as Uzbekistan’s economy grows and incomes rise, durable goods consumption should increase significantly. Analysis show robust growth in the acquisition of durable goods by Uzbek households during 2017–2024 [4]. Changes in Household Durable Goods Usage in Uzbekistan (2017 -2024) INTERNATIONAL SYMPOSIUM “ADVANCED RESEARCH IN ECONOMICS AND BUSINESS MANAGEMENT”, SEPTEMBER 19, 2025 436 Source: National statistics committee of the republic of Uzbekistan. Between 2017 and 2024, Uzbekistan experienced significant growth in household durable goods ownership, reflecting rising incomes, modernization, and improved living standards. Televisions increased from 154 to 177 per 100 households (+15%), indicating nearuniversal access and multi-device ownership. Uzbekistan’s figure is higher than China (119), Kazakhstan (115), and Kyrgyzstan (110), though still below Russia (237). Refrigerators rose from 101 to 121, ensuring reliable food preservation. Domestic enterprises produced 371,700 refrigerators and freezers in 2024, reducing imports and creating jobs [5]. Air conditioners grew from 34 to 57 per 100 households, with the sharpest increases in Karakalpakstan (40→62) and Tashkent (70→97), driven by income growth and hotter summers. Vacuum cleaners expanded from 54 to 84, easing household labor and supporting women’s participation in work and education. Washing machines rose from 80 to 101, reaching near saturation alongside infrastructure improvements. Digital adoption also advanced: computers grew from 80 to 101 per 100 households, while mobile phone use soared from 257 to 356. This indicates that nearly every household member owns at least one device, enabling wider access to e-commerce, education, and financial services. Regional leaders such as Bukhara (441), Khorezm (402), and Karakalpakstan (395) highlight uneven but rapid diffusion. Private vehicle ownership grew from 44 to 59 per 100 households, signaling middle-class expansion. By 2024, Uzbekistan had 103 cars per 1,000 inhabitants, still below Russia (322) and Kazakhstan (214), suggesting significant room for future growth as incomes and credit access expand. Overall, the period shows steady modernization in household assets. Rising affordability, domestic production, and digital integration have improved welfare and productivity. However, regional disparities remain, underlining the importance of targeted policies to ensure inclusive access to durable goods across the country. Regional Comparative Analysis The composite (integral) index is calculated by summing ownership rates across major durable goods (such as televisions, refrigerators, washing machines, and cars) and dividing by INTERNATIONAL SYMPOSIUM “ADVANCED RESEARCH IN ECONOMICS AND BUSINESS MANAGEMENT”, SEPTEMBER 19, 2025 437 the number of goods considered. This measure reflects the overall degree of household provision with durable goods, offering a broader perspective than single-product indicators [6]. Regional Variation of Living Standards Index in Uzbekistan (2024) Source: Based author’s own calculation. Based on this index, Tashkent city (145) and Bukhara region (142) occupy the leading positions in Uzbekistan. Their high scores correspond to higher average wages, stronger household purchasing power, and more advanced infrastructure, which make durable goods more accessible. Urbanization and well-developed retail and service networks also contribute to this advantage. At the opposite end, Surxondaryo (117) and Namangan (120) show lower index values. These lagging results are closely linked to lower per-capita incomes, weaker employment opportunities, and more limited infrastructure in these regions. As a result, households there face greater constraints in acquiring and maintaining durable goods, reinforcing regional disparities in welfare. These differences imply that targeted policy interventions are required. Measures such as expanding consumer credit facilities, introducing VAT refunds or cashback for energy-efficient appliances, and improving infrastructure would directly enhance household access to durable goods in lagging regions. By doing so, the government can promote more equitable improvements in living standards across the country. Conclusion and Policy Recommendations The analysis of durable goods consumption in Uzbekistan during 2017–2024 demonstrates a clear upward trend in household welfare. Televisions, refrigerators, washing machines, and mobile phones are now almost universal, while air conditioners, computers, and cars show strong growth but still have significant room for expansion. Regional disparities remain evident: households in Tashkent and Bukhara enjoy higher access, while those in Surxondaryo and Namangan lag behind due to lower incomes and weaker infrastructure. To ensure inclusive and sustainable growth, several recommendations can be made: 1. Targeted fiscal incentives. Introduce VAT refund schemes for durable goods purchases in lagging regions. For instance, in Surxondaryo and Namangan regions, a pilot INTERNATIONAL SYMPOSIUM “ADVANCED RESEARCH IN ECONOMICS AND BUSINESS MANAGEMENT”, SEPTEMBER 19, 2025 438 program could return the 12% VAT on household appliance purchases. This would make goods more affordable, stimulate local demand, and encourage formal retail transactions. In Germany’s post-pandemic experience shows the effectiveness of VAT policies. When German households received VAT refunds on durable goods, their appliance expenditures rose by €21 billion, underlining the potential of such measures to boost both household welfare and the national economy [7]. 2. Strengthening domestic production. Support for local manufacturers such as Artel and UzAuto should continue, but with a focus on improving quality, energy efficiency, and competitiveness. This will ensure that affordable, durable, and environmentally friendly products are widely available. In conclusion, durable goods are not just consumer products but essential tools of human development, improving nutrition, reducing household labor, enhancing digital connectivity, and expanding economic opportunities. Ensuring broader access through targeted policies like VAT refunds and support for domestic industry can accelerate Uzbekistan’s path toward higher living standards and more balanced regional development. REFERENCES 1. Keynes, John M. The General Theory of Employment, Interest and Money. London : Macmillan, 1936. 2. Modigliani, Franco & Brumberg, Richard. Life-Cycle Hypothesis: Theory and Empirical Evidence // Princeton Essays in International Finance. – 1950s. 3. CEIC Data. China Engel’s Coefficient: Historical Rural Data (1978-to date) // CEIC Data. – n.y. – URL: https://www.ceicdata.com/en/china/gini-coefficient-and-engels-coefficient/cnengels-coefficient-ytd-rural 4. State Statistics Committee of the Republic of Uzbekistan. Turmush darajasi bo‘yicha ko‘rsatkichlar. – URL: https://siat.stat.uz/ 5. State Statistics Committee of the Republic of Uzbekistan. Industrial Production of the Republic of Uzbekistan, January–December 2024: Press Release. – Ташкент : Stat.uz, 2025. – URL: https://stat.uz 6. Nardo M., etl. Handbook on Constructing Composite Indicators: Methodology and User Guide. – Paris : OECD, 2005. – 158 p. 7. Bachmann Ruediger and etl . 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