Excellent chartporn from the Wall Street Journal in how the Great Recession altered American’s spending habits broken down in income quintiles (five 20% groupings).
[click to enlarge image]
Notice the change in elastic commodities (alcohol, retail apparel, etc.) versus inelastic commodities like food for a healthy home cooked meal.
Not to delve too deeply into the economics here, but in describing an inelastic commodity like food, for example, means your demand for regular food consumption will not likely be significantly changed by the price of food (e.g. you’ll be hungry everyday for a long, long time). Conversely, an elastic commodity, like a new pair of blue jeans, is elastic because it’s demand will shrink as the price goes up or wages fall.
Image Source & Credit
Wall Street Journal
Middle Class Slams Brakes on Spending