Q: does setting up a personal hot spot allow other people to use up your cellular data

Only if you gave them your wi-fi password or allowed them to pair with you via Bluetooth. More information on Personal Hotspot: iOS: Understanding Personal Hotspot

Basically yes.  Personal Hotspot means you are sharing out your Cellular Data connection.

If you give the Hotspot password to someone they will use your Cellular data to access the internet.