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Spatial disparities in household earnings in India: Role of urbanization, sectoral inequalities, and rural-urban differences

S Chandrasekhar, Karthikeya Naraparaju () and Ajay Sharma
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Karthikeya Naraparaju: Indian Institute of Management, Indore

Indira Gandhi Institute of Development Research, Mumbai Working Papers from Indira Gandhi Institute of Development Research, Mumbai, India

Abstract: This paper focuses on spatial disparities in household earnings in rural and urban India. A point of departure from the existing literature on inequality in India is that we focus on household earnings rather than consumption expenditure. We analyse data from the nationally representative Periodic Labour Force Survey 2018-19. We provide a rich description of distribution of rural and urban monthly per capita household earning at the national and sub-national level and estimates of earnings inequality. While there are a multitude of factors that affect the evolution of income inequality, we focus on the salience of urbanization in explaining differences in inequality at the sub-national level vis a vis India. The results of the decomposition exercise help identify the proximate factors behind inequality differentials across various states. We situate our findings within the Kuznets framework and the stylized facts in the extant literature

Keywords: Households Earnings; Inequality; Urbanization; India; Decomposition (search for similar items in EconPapers)
JEL-codes: D31 D63 R1 (search for similar items in EconPapers)
Pages: 34 pages
Date: 2021-03
New Economics Papers: this item is included in nep-ure
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