Income Elasticity of Demand | Lower Demand for Festive Non-Essentials as Disposable Incomes Tighten

A classic example of income elasticity of demand here - and it looks like bad news for retailers and others selling "non-essential" goods in the key Xmas season.

Primary market research reported here in the Guardian indicates that UK shoppers are expected to spend £4.4bn less on non-essentials, which is a fall of 22% compared with 2021.

Lots of useful analysis in the article, which suggests that clothing and footwear retailers are set to suffer most.

Shoppers are also expecting to cut back on demand for electrical goods, toys and homewares.

Hopefully someone has alerted Santa Claus.