Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/174084 
Authors: 
Year of Publication: 
2017
Series/Report no.: 
IZA Discussion Papers No. 11174
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
Using data from the large scale consumption expenditure surveys collected by Indian National Sample Survey Organization, we examine the urban-rural welfare gap in India in 1983, 1993-94, 2004-05, and 2011-12 across the entire distribution. Our main measure of welfare is spatially adjusted per capita consumption expenditure. We find that the urban-rural gap increased considerably between 1993-94 and 2004-05, and increase is larger at the higher quantiles. Using the unconditional quantile regression decomposition, we find that majority of the gap is explained by the urban advantage in endowments in all four years. The contribution of the unexplained effect (differences in rewards) in urban advantage was negative in 1983 and 1993-94 across the entire distribution. We find that difference in educational distribution across urban and rural areas is the most important driver of the observed gap. We find similar patterns using income data for 2004-05 and 2011-12 from India Human Development Surveys.
Subjects: 
urban-rural welfare gap
unconditional quantile regression
India
JEL: 
I32
Document Type: 
Working Paper

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