Development of a Consumer Confidence Index for Pakistan: A Pilot Study on Three Main Urban Cities

Abstract

What is meant by consumer sentiments index? What influences these indices? How should confidence indices be developed and how are they to be analyzed. And most importantly, how should an index for Pakistan be developed? These are the questions that have been focused in this study. The purpose of this pioneer study is to develop a reliable consumer confidence index for Pakistan and to plot test it on a small urban sample. The two most quoted indexes to measure consumer confidence in the US are the Michigan Consumer Sentiments Index (ICS) and the Consumer Confidence Index (CCI) published by the Conference Board. Based on these surveys, a unified scale was developed and tested for Pakistan. The findings for the survey are that, urban Pakistani citizens have very little confidence in the economy which includes sentiments about their own wellbeing as well as their expectations about the future.