Government final consumption expenditure (GFCE) is an aggregate transaction amount on a country's national income accounts representing government expenditure on goods and services that are used for the direct satisfaction of individual needs (individual consumption) or collective needs of members of the community (collective consumption).[1]
It consists of the value of the goods and services produced by the government itself other than own-account capital formation and sales and of purchases by the government of goods and services produced by market producers that are supplied to households – without any transformation – as social transfers in kind (for more detail, see, for example, Lequiller and Blades (2014)[2]
Data on government final consumption expenditure shed light on the involvement of governments in providing goods and services for the direct needs of the population. A high government share in the provision of individual consumption goods and services is often found in countries known as welfare states. This may be illustrated by looking at data for the European Union (downloadable from Eurostat's database providing figures on government expenditure):
