Impact of Price Hike on the Standard of Living of Middle Income People: A Study on Sylhet City, Bangladesh

Abstract

The purpose of this research is to identify the impact of price hike on the living standard of middle income people. The researchers tried to identify the alternatives of middle class people in face of price hike or inflation. This descriptive analytical research is conducted by random probability sampling. The data were collected by a well designed questionnaire that was tested by experts in this field to ensure the validity of the research. The responses from 98 households are processed and analyzed by frequency distribution, cross tabulation and Chi-square tests. The impact of price hike (minor, medium and major) is tested in respect of compensate by more income, change in food habits, change in accommodation and education. The result showed that there is a small reaction in the minor inflation but in medium and major inflation most of the respondents seeks alternatives to face the crisis. A significant difference in the reaction is found in most of the cases with the levels of price hikes. But the middle income people have the tendency to maintain the status quo in their life style and standard of living. The management may generate new products or services for the middle class people by keeping the mindset of them in the time of price hike. The authority should consider compensating the middle class in various ways to restore their consumption level to continue the economic activities of a country.