Income Inequality and Caste in Village India
In this paper, we examine inequality in incomes between households of different castes in rural India, using a unique dataset comprising household data from a cross-section of eight villages across four States. The focus of this paper is on Dalit or Scheduled Caste households. We begin with very simple measures of differences between groups, such as proportional representation in different quintiles and the frequency distribution of households across income levels in different social groups. We then estimate a standard GE(2) inequality index along with its decomposition by caste. Lastly, we compute an alternative benchmark for assessing the share of between-group inequality in total inequality as suggested by Elbers, Lanjouw, Mistiaen, and Ozler (ELMO 2008). Our analysis shows high levels of income inequality between households of different caste groups.
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