Budget Group

the group of the goods and services that characterize the volume (calculations per family or per capita) and structure of consumption. It is employed for calculating the budget index and for characterizing the standard of living of families. The group is formed from food products, industrial goods, and services. The group of food products, where physiological norms of consumption serve as the criterion, is considered the most valid. The compilation of groups of industrial goods and of services (which undergo substantial changes) is much more complicated and less reliable. There are various types of budget groups: the subsistence minimum, well-to-do budget, and standard (constructive) budget. By means of such budget groups, the various degrees to which workers’ needs are satisfied are established—levels of satisfaction that are determined by the historical development and social structure of society and that characterize the volume and structure of consumption. A particular weight is ascribed to every group of goods and services, corresponding to the group’s role in the consumer budget. The development of budget groups (general groups and groups for cross sections of social groups and for different regions of the country) that ensure the fullest and most rational satisfaction of the needs of the toiling masses is one of the pressing economic problems in the USSR. Budget groups are usually made up for families of a particular size and composition on the basis of budget investigations of the population. There are two methods of compiling budget groups. The first is based on the personal evaluation of the investigator, who decides what a family needs in order to carry on a particular way of life. In this case, the composition of the budget group depends, to a large extent, on the individual tastes of the investigators. The second method is based primarily on the study of the patterns of actual budgets; it is only partially based on expert estimates. Standard consumption calculations cover about 75-80 percent of the articles of the budget group.

In the USA the standard budget for industrial and office workers from 1920 to 1962 was worked out by the Committee for Research in Social Economics of the University of California, under the name of the “Heller budget”; since 1963, it has been made up by the Bureau of Labor Statistics of the Department of Labor. The budget is calculated for a family of four (husband, wife, and two children). The Bureau of Labor Statistics has an interest in minimizing the total size of the standard budget, which is used to determine pay rates when collective bargaining agreements are concluded.