Journal of African Development

The present study explores the linkage between economic stability (ES) and social relationship expenditures (SRE) in India by utilizing household-level data obtained from national surveys such as the India Human Development Survey (IHDS) and the Periodic Labour Force Survey (PLFS) for the period 2010–2022. The sample consists of 8,866 observations representing diverse socio-economic backgrounds across the country. A fixed-effects estimation technique is applied to assess how variations in economic stability influence household spending on social and relational activities.

The findings demonstrate a positive and statistically significant relationship between economic stability and expenditures on social relationships. Households with stronger financial positions are more likely to invest in social interactions, including participation in family ceremonies, community gatherings, and cultural events. Conversely, financial obligations such as housing loans and other debts reduce the ability of households to allocate resources toward such activities. The moderating effects of health and education provide deeper insights into this relationship. Better health conditions enhance the impact of economic stability on social expenditures by lowering healthcare-related financial pressure and facilitating social involvement. In contrast, higher educational attainment weakens this association, as educated households tend to emphasize long-term financial security through savings and investments rather than immediate discretionary spending.

Overall, the results identify economic stability as a key driver of social relationship expenditures, while health acts as a supportive factor and education alters spending priorities. From a policy standpoint, initiatives aimed at reducing household debt burdens, expanding access to affordable healthcare through programs such as Ayushman Bharat, and strengthening financial awareness under schemes like Pradhan Mantri Jan Dhan Yojana (PMJDY) can improve households’ capacity for social participation. By narrowing gaps in economic stability, health, and education, policymakers can promote both social integration and economic sustainability in India