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How is the growth of Tier 2 cities related to the rise of a new middle class with an emphasis on the culture of consumption?

The middle classes constitute a critical market for most goods and services. A sizable portion of any nation’s tax revenue is collected either directly or indirectly from this group and they are important for economic and social development via urbanization and industrialization.

  1. Middle class working in metro cities but due to heavy land cost, they are purchasing lands in Tier 2 cities. Ex:- Sonipat because of NCR Development. 
  2. Work from Home has resulted into demand of goods and services in Tier 2 cities, thus opening of Pizza outlets, Dosa corner etc. 
  3. The major reason of rise in Consumption in a new middle class can be Work, Stress and Enjoyment Purposes. 
  4. Start-ups find that initial costs are much lower, skilled personnel more affordable, and local authorities a lot friendlier in tier 2 and tier 3 cities. 
  5. Aesthetics are as important as functionality, an office should be a space where employees feel excited to step in, every day. Ex:- Nissan’s Digital Hub in Thiruvananthapuram. 
  6. Today the millennial does not just want to satisfy their needs, but satisfied at faster pace. Ex: - Zepto10 Minutes delivery and Amazon delivery in small towns too. 
  7. Purchasing power of middle class have increased and thus shift in the pattern of consumption has been observed.

The middle class is claimed to be the ‘bird of gold’. India’s rising middle class is an engine of growth. The rising middle class is both a causal factor behind India’s improved economic and social outcomes—growth, education, home ownership, and social security—as well as a consequence of the rise in the middle class. 


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