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A Study on Rural Poverty Using Inequality Decomposition in Western Hills of Nepal: A Case of Gulmi District

  • Joshi, Niraj Prakash
  • Maharjan, Keshav Lall

Involvement of higher proportion of economically active population in agriculture and laboring among the Occupational caste resulted into higher incidence of poverty, which is also severer and deeper. This resulted into as high as 71% incidence of poverty in Banjhkateri, purely remote village. The incidence, depth and severity of poverty are the highest among large family size households, illiterate households, and small land and livestock holding households. Share of income from agriculture, remittance, and salaried job shares is the most significant one contributing 46.1%, 23.3% and 19.0% of total income, respectively. However, income from salaried job and remittance has income disequalizing effect and also has higher factor inequality weight acting as the source of income inequality. Agriculture and laboring, upon which huge proportion of economically active population is engaged and entry is also not restricted, however has income equalizing effect. This suggests the need for promotion of labor-intensive agriculture as a better rural development policy in the rural Nepalese context. In the context of lack of well-defined working hours as well as minimum wage rate such rural development policies should be supplemented by formulation and effective enforcement of labor policy.

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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 35386.

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Date of creation: 2008
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Publication status: Published in Journal of International Development and Cooperation 2.14(2008): pp. 1-17
Handle: RePEc:pra:mprapa:35386
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  1. Wan, Guang Hua, 2001. "Changes in regional inequality in rural China: decomposing the Gini index by income sources," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 45(3), September.
  2. Adams, Richard H. Jr. & He, Jane J., 1995. "Sources of income inequality and poverty in rural Pakistan:," Research reports 102, International Food Policy Research Institute (IFPRI).
  3. Joshi, Niraj Prakash & Maharjan, Keshav Lall, 2007. "Assessment of food self-sufficiency and food security situation in Nepal," MPRA Paper 35385, University Library of Munich, Germany.
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