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Rural–Urban Disparities in India in the Time of Growth

Author

Listed:
  • Ghosh, Sudipta
  • Hnatkvska, Viktoria
  • Lahiri, Amartya

Abstract

The period since the 1990s has seen an aggregate growth takeoff in India during which the rural agricultural sector has gradually ceded space in both employment and output share to non-agricultural sectors. How have agriculture-dependent rural workers and households fared during this episode relative to their urban counterparts? Using household-level survey data, we find that rural–urban education gaps have declined significantly between 1983 and 2012. Moreover, occupation choices in the two sectors have become more aligned with an expansion of non-farm occupations in rural India. Consumption gaps between rural and urban households also declined between 1983 and 2005 for the bottom 45th percentile of the distribution. The period since 2005 has, however, witnessed a rise in consumption gaps. Using state-leveldata, we show that per capita income levels and growth rates are positive correlates of rural–urban consumption gaps, while the education gap is a negative correlate.

Suggested Citation

  • Ghosh, Sudipta & Hnatkvska, Viktoria & Lahiri, Amartya, 2020. "Rural–Urban Disparities in India in the Time of Growth," India Policy Forum, National Council of Applied Economic Research, vol. 16(1), pages 219-265.
    • Handle: RePEc:nca:ncaerj:v:16:y:2020:i:2020-1:p:219-265
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    File URL: https://www.ncaer.org/publication/india-policy-forum-2019
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    More about this item

    Keywords

    Rural–Urban Disparity; Consumption Gaps; Education;
    All these keywords.

    JEL classification:

    • E2 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development
    • R2 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis

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