ABSTRACT
In developing economies, many transactions occur outside of markets and involve the bartering of goods and services. This paper focuses on the Philippines and Vietnam, where poverty alleviation programs play a critical role in maintaining minimal living standards, making it essential to understand how impoverished households make ends meet through in-kind transactions. The authors examine the validity of Engel's Law in developing countries. It is one of the most important empirical laws for analyzing consumer behavior and has been verified by cross-sectional data from many countries. The first is that Engel's Law does not always hold, particularly among poor households in developing countries. In the present analysis, people considered the role of in-kind consumption in terms of the total consumption expenditure of households. In addition to the empirical findings of an inverse U-shaped Engel curve in Tanzania, Vietnam, and the Philippines, people raise questions about the validity of Engel's Law that requires further empirical research in developing nations.
