Why is distribution of income considered as determinants of consumption?

The distribution of income is a key determinant of consumption because it affects the purchasing power of different households. Higher income inequality can lead to a situation where wealthier individuals save a larger portion of their income, while lower-income households tend to spend a higher percentage of their earnings on necessities. This disparity influences overall consumption patterns and economic demand. Furthermore, changes in income distribution can impact consumer confidence and spending behaviors across different socioeconomic groups.