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Accounting for Inequality in India: Evidence from Household Expenditures

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  • Cain, J. Salcedo
  • Hasan, Rana
  • Magsombol, Rhoda
  • Tandon, Ajay

Abstract

Summary We utilize household-level consumption expenditure data from India to examine the evolution of inequality during 1983-2004. Various measures of inequality show that inequality levels were relatively stable during 1983-93, but increased during 1993-2004. The increases in inequality have not precluded reductions in poverty, however. They are also more of an urban phenomenon and can be accounted for by increases in returns to education in the urban sector to a considerable extent, especially among households that rely on income from education-intensive services and/or education-intensive occupations. Some of the increases in the returns to education can be linked to economic liberalization undertaken in the 1990s.

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  • Cain, J. Salcedo & Hasan, Rana & Magsombol, Rhoda & Tandon, Ajay, 2010. "Accounting for Inequality in India: Evidence from Household Expenditures," World Development, Elsevier, vol. 38(3), pages 282-297, March.
  • Handle: RePEc:eee:wdevel:v:38:y:2010:i:3:p:282-297
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    References listed on IDEAS

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    Cited by:

    1. Ojha, Vijay P. & Pradhan, Basanta K. & Ghosh, Joydeep, 2013. "Growth, inequality and innovation: A CGE analysis of India," Journal of Policy Modeling, Elsevier, vol. 35(6), pages 909-927.
    2. Azam, Mehtabul, 2012. "Changes in Wage Structure in Urban India, 1983–2004: A Quantile Regression Decomposition," World Development, Elsevier, vol. 40(6), pages 1135-1150.
    3. Sen Gupta, Abhijit & Hasan, Rana & Lamba, Sneha, 2014. "Growth, Structural Change, and Poverty Reduction: Evidence from India," MPRA Paper 55247, University Library of Munich, Germany.
    4. Mehta, Aashish & Hasan, Rana, 2012. "The effects of trade and services liberalization on wage inequality in India," International Review of Economics & Finance, Elsevier, vol. 23(C), pages 75-90.
    5. repec:eee:wdevel:v:97:y:2017:i:c:p:102-121 is not listed on IDEAS
    6. Sanjoy Chakravorty & S. Chandrasekhar & Karthikeya Naraparaju, 2016. "Income generation and inequality in India's agricultural sector: The Consequences of land fragmentation," Indira Gandhi Institute of Development Research, Mumbai Working Papers 2016-028, Indira Gandhi Institute of Development Research, Mumbai, India.
    7. Fulford, Scott, 2014. "Returns to Education in India," World Development, Elsevier, vol. 59(C), pages 434-450.
    8. Gülay Günay & Ayfer Boylu & Özgün Bener, 2014. "An Examination of Factors Affecting Economic Status and Finances Satisfaction of Families: A Comparison of Metropolitan and Rural Areas," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 119(1), pages 211-245, October.
    9. Das, Samarjit & Ghate, Chetan & Robertson, Peter E., 2015. "Remoteness, Urbanization, and India’s Unbalanced Growth," World Development, Elsevier, vol. 66(C), pages 572-587.
    10. Tripathi, Sabyasachi, 2016. "Source of Inequality in consumption Expenditure in India: A Regression Based Inequality Decomposition Analysis," MPRA Paper 72117, University Library of Munich, Germany.
    11. Sanjoy Chakravorty & S. Chandrasekhar & Karthikeya Naraparaju, 2017. "Income Generation and Inequality in India's Agricultural Sector: The Consequences of Land Fragmentation," Working Papers id:11692, eSocialSciences.
    12. repec:ebl:ecbull:eb-17-00091 is not listed on IDEAS
    13. Shantanu Khanna & Deepti Goel & René Morissette, 2016. "Decomposition analysis of earnings inequality in rural India: 2004–2012," IZA Journal of Labor & Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 5(1), pages 1-26, December.
    14. Bhattacharya, Sukanta & Saha, Sarani & Banerjee, Sarmila, 2016. "Income inequality and the quality of public services: A developing country perspective," Journal of Development Economics, Elsevier, vol. 123(C), pages 1-17.
    15. Paola A. Barrientos Q. & Niels-Hugo Blunch & Nabanita Datta Gupta, 2015. "Income Convergence and the Flow out of Poverty in India, 1994-2005," Economics Working Papers 2015-09, Department of Economics and Business Economics, Aarhus University.
    16. Azam, Mehtabul & Bhatt, Vipul, 2016. "Spatial Income Inequality in India, 1993-2011: A District Level Decomposition," IZA Discussion Papers 9892, Institute for the Study of Labor (IZA).
    17. Barry Eichengreen & Poonam Gupta, 2010. "The Service Sector as India’s Road to Economic Growth?," Development Economics Working Papers 23030, East Asian Bureau of Economic Research.
    18. S. Mahendra Dev, 2016. "The Problem of inequality," Indira Gandhi Institute of Development Research, Mumbai Working Papers 2016-029, Indira Gandhi Institute of Development Research, Mumbai, India.
    19. Amit Basole & Deepankar Basu, 2015. "Non-Food Expenditures and Consumption Inequality in India," UMASS Amherst Economics Working Papers 2015-06, University of Massachusetts Amherst, Department of Economics.
    20. Vijay P. Ojha & Joydeep Ghosh, 2014. "Optimizing Public Expenditure Allocations between Secondary and Higher Education," Centre for International Trade and Development, Jawaharlal Nehru University, New Delhi Discussion Papers 14-02, Centre for International Trade and Development, Jawaharlal Nehru University, New Delhi, India.
    21. Khanna, Shantanu & Goel, Deepti & Morissette, René, 2016. "Decomposition Analysis of Earnings Inequality in Rural India: 2004-2012," IZA Discussion Papers 9974, Institute for the Study of Labor (IZA).

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    inequality poverty Asia India;

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