Earnings Inequality in India: Has the Rise of Caste and Religion Based Politics in India Had an Impact?

Sumon Bhaumik and Manisha Chakrabarty ()

No 2008, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: Since 1989, there has been a sharp increase in the role of caste and religion in determining political fortunes at both state and federal levels in India. As a consequence, significant inter-caste and inter-religion differences in earnings have the potential to stall the process of economic reforms. Yet, the patterns and determinants of such differences remain unexplored. We address this lacuna in the literature, and explore the determinants of the differences in inter-caste and inter-religion earnings in India during the 1987-99 period, using the 43rd and 55th rounds of National Sample Survey (NSS). Our results suggest that (a) earnings differences between "upper" castes and SC/ST have declined between 1987 and 1999, (b) over the same period, earnings differences between Muslims and non-Muslims have increased, to the detriment of the former, and (c) inter-caste and inter-religion differences in earnings can be explained largely by corresponding differences in educational endowment and returns on age (and, hence, experience). However, differences in returns on education do not explain inter-caste and inter-religion earnings differences to a great extent.

Keywords: caste; inequality; India; religion (search for similar items in EconPapers)
JEL-codes: O15 O17 (search for similar items in EconPapers)
Pages: 34 pages
Date: 2006-03
New Economics Papers: this item is included in nep-cwa, nep-dev and nep-hrm
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Citations: View citations in EconPapers (18)

Published - published in: A. Shariff and R. Besant (eds.), Handbook of Muslims in India, Oxford University Press, 2010, New Delhi

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Working Paper: Earnings Inequality in India: Has the Rise of Caste and Religion Based Politics in India had an Impact? (2006)
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