agriculture is still the dominant sector in the economy producing more than half of the total GDP. How far is this economic growth reflécted in the consumption of households and individuals? We computed per capita monthly real consumption by region (Table 2) Real per capita food consumption was computed by deflating the nominal per capita food expenditure by the spatial food consumer price index (SFCPI) (Appendix 3). Similarly, the real per capita non-food consumption was computed by deflating the nominal per capita non-food consumption by the spatial non-food consumer price index (SNFCPI) (Appendix 3).’ Real per capita total consumption was computed as the sum of per capita real food and non-food consumption, According to Table 2, the annual growth rate of per capita consumption is only 2.5 whereas the annual growth of per capita GDP during the same period is 4.6 percent. ‘Thus, the average standard of living in Lao PDR is growing at a much slower rate than ‘What is indicated by the growth rate of per capita GDP. Private consumption data from the national accounts are not available, but the discrepancy is not due to the use of a different deflator. Even if real GDP were computed using the same price indices as used for deflating consumption, the growth in real per capita GDP remains much the same.® As shown in Table 2, while Vientiane Municipality is the richest region in terms of its monthly per capita real consumption, the Norther region is the poorest. Moreover, the annual growth rate of real consumption per capita per month in Vientiane Municipality has been 7.9 percent during 1992/93-1997/98, which far exceeds that in the other regions. Moreover, although North has still remained the region with the lowest, living standards in the country, it has been growing faster than Central’ and South: real monthly consumption per capita in North increased at the annual rate of 2.7 percent over this period relative to about 1 percent in Central and South. Note that the Southern region has higher average living standards than the Norther region but lower than Central and ” Per capita nominal food and non-food consumption expenditures are the adjusted expenditures as, described in Section 3. * Discrepancies between survey and national accounts growth rates are not uncommon. For instance, for India growth rates from the two sources have diverged over the 1990s; see Datt (1999), Ravallion (2000). ° Note that for the purposes of the analysis presented inthis paper, the Central region excludes Vientiane Municipality.