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Inequality, neighborhoods and variation in prices

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  • Abhimanyu Dadu

    ()
    (Indira Gandhi Institute of Development Research)

  • Namrata Gulati

    ()
    (Indira Gandhi Institute of Development Research)

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    Abstract

    In this study we examine the link between of income distribution and wholesale price of wheat using panel data. We have weekly time series data on prices for wheat for 3 districts in Uttar-Pradesh in India obtained from the Department of Economics and Statistics of the Ministry of Agriculture, Government of India (DES-MOA, GOI) for the period 2006-2011. Gini coefficient is calculated on the basis of consumption expenditure collected by National Sample Survey Organisation of India. We find that there is inverted-U shape relation between inequality and level of price for wheat: if we compare a cross-section of societies over the period of time, then price of food grain initially increases with increase in inequality but after a point it starts declining.

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    Bibliographic Info

    Paper provided by Indira Gandhi Institute of Development Research, Mumbai, India in its series Indira Gandhi Institute of Development Research, Mumbai Working Papers with number 2014-001.

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    Length: 25 pages
    Date of creation: Jan 2014
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    Handle: RePEc:ind:igiwpp:2014-001

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    Related research

    Keywords: Kalman Filter; Inequality; Prices; Neighborhood; Panel;

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    1. Durgesh Chandra Pathak, 2010. "Poverty and Inequality in Uttar Pradesh during 1993-94 to 2004-05 A Decomposition Analysis," Development Economics Working Papers 23022, East Asian Bureau of Economic Research.
    2. Amita Majumder & Ranjan Ray & Kompal Sinha, 2012. "Spatial Comparisons of Prices and Expenditure in a Heterogeneous Country: Methodology with Application to India," Development Research Unit Working Paper Series, Monash University, Department of Economics 19-12, Monash University, Department of Economics.
    3. Bergh, Andreas & Nilsson, Therese, 2012. "When More Poor Means Less Poverty: On Income Inequality and Purchasing Power," Working Papers, Lund University, Department of Economics 2012:2, Lund University, Department of Economics.
    4. Marie Daumal, 2010. "The impact of trade openness on regional inequality : the cases of India and Brazil," Working Papers, DIAL (Développement, Institutions et Mondialisation) DT/2010/04, DIAL (Développement, Institutions et Mondialisation).
    5. Aaron Nicholas & Ranjan Ray & Rebecca Valenzuela, 2008. "Evaluating The Distributional Implications Of Price Movements: Methodology, Application And Australian Evidence," Development Research Unit Working Paper Series, Monash University, Department of Economics 33/08, Monash University, Department of Economics.
    6. Rasika P. Chikte, 2011. "Income Convergence and Regional Growth in India," South Asia Economic Journal, Institute of Policy Studies of Sri Lanka, Institute of Policy Studies of Sri Lanka, vol. 12(2), pages 239-269, September.
    7. Muellbauer, John, 1974. "Household composition, Engel curves and welfare comparisons between households : A duality approach," European Economic Review, Elsevier, Elsevier, vol. 5(2), pages 103-122, August.
    8. Pendakur, Krishna, 2002. "Taking prices seriously in the measurement of inequality," Journal of Public Economics, Elsevier, Elsevier, vol. 86(1), pages 47-69, October.
    9. Mehtabul Azam & Abusaleh Shariff, 2011. "Income Inequality in Rural India: Decomposing the Gini by Income Sources," Economics Bulletin, AccessEcon, vol. 31(1), pages 739-748.
    10. Ankita Mishra & Ranjan Ray, 2009. "Prices, Inequality and Poverty: Methodology and Indian Evidence," Development Research Unit Working Paper Series, Monash University, Department of Economics 27-09, Monash University, Department of Economics.
    11. Sperling, Lena Lindbjerg & Kjøller-Hansen, Anders Oskar, 2012. "Accounting for the effect of health on cross-state income inequality in India," Economics Letters, Elsevier, Elsevier, vol. 115(2), pages 252-255.
    12. Manisha Chakrabarty & Amita Majumder & Ranjan Ray, 2012. "Preferences, Spatial Prices and Inequality," Development Research Unit Working Paper Series, Monash University, Department of Economics 52-12, Monash University, Department of Economics.
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