Insights into economic inequality and economic mobility: a longitudinal analysis of agricultural and non-agricultural household income in Punjab, India

PurposeThis study aims to analyse the status of economic inequality and economic mobility in Punjab through the lens of agricultural and non-agricultural household income.Design/methodology/approachThis paper uses longitudinal data from the India Human Development Survey (IHDS) for the periods 2004–2005 and 2011–2012. It compares agricultural and non-agricultural household income across different income quintiles, explores income inequality using the Gini coefficient and Lorenz curve, and measures mobility through a transition matrix among these households with varying socio-demographic characteristics.FindingsThe study found that inequality increased for both agricultural and non-agricultural households over the period, with Gini coefficients increasing to 0.58 and 0.47, respectively. However, agricultural households were the primary contributors to rising inequality at the state level. For agricultural households, the primary drivers of inequality were “Others” (General) category households and female-headed households. For non-agricultural households, the “Others” category households and male-headed households were the main sources of inequality. The highest economic immobility among agricultural households was contributed by the “Others” category and male-headed households, while mobility among non-agricultural households was driven by SC and OBC households and male-headed households.Originality/valueBy examining inequality and mobility among agricultural and non-agricultural households, this study can determine whether one sector, both sectors or specific caste or gender categories require more policy focus to enhance economic growth in Punjab. Moreover, the literature lacks studies that explore economic mobility through agricultural and non-agricultural income in Punjab. This study can provide valuable insights into economic inequality and economic mobility in the context of Punjab.