Measuring Poverty and Socio-Economic Deprivation Inequalities in India at Sub-National Level

Abstract

This study examines the inequality of income, poverty and socio-economic variables manifesting human deprivation across the sixteen major states in India at different points of time. There exists a positive trend of inequality in income and poverty (measured in terms of head-count ratio-HCR) across the states at seven points of time, but there is a sharp increase in inequality in poverty after 1993-94. Since HCR captures only one dimension of poverty viz. income, we measure other non-income dimensions of human deprivations and their inequalities at three points of time: 1980-81, 1990-91 and 2000-2001. The results show a common positive trend of inequality implying increasing regional imbalance over the decades. Keeping in mind the problem of weights and aggregation in estimating Human Poverty Index (HPI) popularized by UNDP, a new multidimensional measure of poverty is suggested. This new measure of poverty is found compatible with the head-count ratio and human poverty index estimated by Planning Commission, India. Cluster Analysis has been applied in a similar context of human deprivation on the major states of India that provides us two distinct clusters in three points of time: 1980-81, 1990-91 and 2000-2001. The results show that Kerala has been a distinctive state in India in all the three points of time.