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Why Have Some Indian States Done Better than Others at Reducing Rural Poverty?

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  • Gaurav Datt
  • Martin Ravallion

Abstract

Rural poverty rankings of Indian states in 1990 were very different from those of 1960. This unevenness in progress allows us to study the causes of poverty in a developing rural economy. We model the evolution of various poverty measures using pooled state‐level data for the period 1957–91. Differences in trend rates of poverty reduction are attributed to differing growth rates of farm yield per acre and differing initial conditions; states starting with better infrastructure and human resources saw significantly higher long‐term rates of poverty reduction. Deviations from trend are attributed to inflation (which hurt the poor in the short term) and shocks to farm and non‐farm output.

Suggested Citation

  • Gaurav Datt & Martin Ravallion, 1998. "Why Have Some Indian States Done Better than Others at Reducing Rural Poverty?," Economica, London School of Economics and Political Science, vol. 65(257), pages 17-38, February.
    • Handle: RePEc:bla:econom:v:65:y:1998:i:257:p:17-38
    DOI: 10.1111/1468-0335.00112
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    1. Lipton, Michael & Ravallion, Martin, 1995. "Poverty and policy," Handbook of Development Economics, in: Hollis Chenery & T.N. Srinivasan (ed.), Handbook of Development Economics, edition 1, volume 3, chapter 41, pages 2551-2657, Elsevier.
    2. Datt, Gaurav*Ravallion, Martin, 1990. "Regional disparities, targeting, and poverty in India," Policy Research Working Paper Series 375, The World Bank.
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    6. Bell, Clive & Rich, Robert, 1994. "Rural Poverty and Aggregate Agricultural Performance in Post-independence India," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 56(2), pages 111-133, May.
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