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Trade and Inequality in India

Author

Listed:
  • Pravin Krishna

    (Johns Hopkins University)

  • Guru Sethupathy

    (Johns Hopkins University)

Abstract

To study the effects of the dramatic economic reforms undertaken in India in the early 1990s on inequality, this paper uses the Theil inequality measure constructed using Indian household expenditure survey data from 1988-2005. Overall inequality shows some variation over the period, rising between 1988 and 1994 and again between 1994 and 2000, but falling by 2005 to roughly the pre-reform level. Furthermore, in the post reform period (between 1994 and 2005), inequality fell in most Indian states, with rural areas in most states and urban areas in about half the states experiencing a statistically significant reduction in inequality. The change in inequality across households within states is found to uncorrelated with the change in state-level measures of tariff and non-tariff protection.

Suggested Citation

  • Pravin Krishna & Guru Sethupathy, 2010. "Trade and Inequality in India," Working Papers 5555, School of International and Public Affairs, Columbia University, revised Oct 2010.
    • Handle: RePEc:ecq:wpaper:5555
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    File URL: http://indianeconomy.columbia.edu/sites/default/files/working_papers/wp_2010-5_v2.pdf
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    References listed on IDEAS

    as
    1. Parthapratim Pal & Jayati Ghosh, 2007. "Inequality in India: A survey of recent trends," Working Papers 45, United Nations, Department of Economics and Social Affairs.
    2. Simon Kuznets & Elizabeth Jenks, 1953. "Shares of Upper Income Groups in Income and Savings (1953)," NBER Books, National Bureau of Economic Research, Inc, number kuzn53-1, May.
    3. Nirvikar Singh & Laveesh Bhandari & Aoyu Chen & Aarti Khare, 2004. "Regional Inequality in India: A Fresh Look," Development and Comp Systems 0412006, University Library of Munich, Germany.
    4. Angus Deaton & Jean Dreze, 2002. "Poverty and Inequality in India: A Re-Examination," Working Papers 184, Princeton University, Woodrow Wilson School of Public and International Affairs, Research Program in Development Studies..
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Maria Berrittella & Jian Zhang, 2014. "A Global Perspective on Effectiveness of Aid for Trade," Open Economies Review, Springer, vol. 25(2), pages 289-309, April.
    2. Sripad Motiram & Ashish Singh, 2012. "How close does the apple fall to the tree? Some evidence on intergenerational occupational mobility from India," Indira Gandhi Institute of Development Research, Mumbai Working Papers 2012-017, Indira Gandhi Institute of Development Research, Mumbai, India.
    3. Mehtabul Azam, 2022. "Household income mobility in India, 1993–2011," Review of Development Economics, Wiley Blackwell, vol. 26(4), pages 1902-1943, November.
    4. Sripad Motiram & Nayantara Sarma, 2011. "Polarization, inequality and growth: The Indian experience," Working Papers 225, ECINEQ, Society for the Study of Economic Inequality.
    5. Sripad Motiram & Nayantara Sarma, 2014. "Polarization, Inequality, and Growth: The Indian Experience," Oxford Development Studies, Taylor & Francis Journals, vol. 42(3), pages 297-318, September.
    6. Sripad Motiram & Ashish Singh, 2012. "How Close Does the Apple Fall to the Tree?: Some Evidence on Intergenerational Occupational Mobility from India," WIDER Working Paper Series wp-2012-101, World Institute for Development Economic Research (UNU-WIDER).
    7. 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.
    8. Ashish Singh & Kaushalendra Kumar & Abhishek Singh, 2015. "The Changing Structure of Inequality in India, 1993-2010: Some Observations and Consequences," Economics Bulletin, AccessEcon, vol. 35(1), pages 590-603.
    9. Aadil Ahmad Ganaie & Sajad ahmad Bhat & Bandi Kamaiah, 2018. "Macro-determinants of Income Inequality: An Empirical Analysis in case of India," Economics Bulletin, AccessEcon, vol. 38(1), pages 309-325.

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    More about this item

    Keywords

    India; Trade; Inequality; Economic reforms; Household expensiture; tariff and non-tariff protection;
    All these keywords.

    JEL classification:

    • F1 - International Economics - - Trade
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions

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