Indonesia Conference Directory

Consumption in Islam must follow guidance from Allah. In consuming, humans are forbidden to overdo and boast. Conventional economic theory considers that consumption is a measure of peoples welfare. Thus, one of the efforts made by the government to improve the welfare of the community is through smoothed consumption by providing unconditional cash transfer. This study seeks to identify the impact of the unconditional cash transfer program on public consumption expenditure, whether the transfer provision can affect the nature of excess consumption. This study uses Indonesian Family Life Suvey (IFLS) data with fixed effect methods at the village and household level. The results show that there is a change in consumption patterns of Indonesian people and the unconditional cash transfer program has contributed to the change. On average, there has been an increase in spending on carbohydrate consumption. But unfortunately there was a decrease in food and vegetable consumption expenditure. The study showed there were also an increasing in buying food outside, snacks, and cigarettes.