Determinants of Household Expenditures for Services – The Roles of Regional Value Chain

The service sector is crucial for promoting the economic growth. The consumption behaviors on service sector also have been changed and influence of the various factors including the regional value chain. In order to promote the service sector, it is important to understand the demand of the service sector and factors that affect the household expenditure on service sector. Therefore, the main objective of this study is to investigate the factors influencing the household expenditures for the service sector. We used the large dataset, Lao Expenditure and Consumption Survey 5 (LECS5). We use the multi-regression model to investigate these factors. The household income, wife education, and other factors are the key factors to influence the household expenditure for services. In addition, the regional value chain variables such as urban areas, financial institution, and major income from services, road access year-round, electricity, and market in the villages have contributed to household expenditure on services.