A Generalized Measure of Diversity: Application to Longitudinal Data on Crop-groups in North-East India

Abstract

In this paper, we generalize the Herfindahl-Hirschman Index (HHI) using the correlation structure of the individual shares to arrive at a new diversity measure. This is then applied to the cultivation of crops across zones of Assam, India. Before applying these indices we have removed the trend component from the data series. Since the trend effect is eliminated, the indices show the true diversity pattern and reflect the intentions of farmers directly which was not taken into consideration in the earlier measures.

The results show that the diversity indices declined till 1975-76 and then gradually increased up to 1987-88. Thereafter, all the indices became more or less stagnant. It may be because the farmers did not want to take risk or they have less access to the modern farming technology which is also subject to changes over time.