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Income mobility across castes in India: a longitudinal analysis

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Abstract

This paper employs two waves of longitudinal datasets between 1993–1994 and 2004–2005 and 2004–2005 and 2011–2012 to investigate the differences in income mobility across caste groups in India. We analyse three sets of nationally representative data from the Human Development Profile of India (HDPI) 1993–1994 and the Indian Human Development Surveys 2004–2005 and 2011–2012. Moving away from traditional measures, we rely on a graphical depiction of mobility using density curves and growth incidence curves (GIC) to analyse potential differences in relative income across caste groups. We also support our results using income elasticity regressions and controlled for region, religion, source of income, and education in the base year and state fixed effects. The results reflect that starting from a similar base period income quartile, upper caste households are likely to experience higher growth in their income position compared to SCs and STs. Despite this, households from scheduled castes have shown a slight improvement in their average income positions. The enduring nature of caste-based income disparities is evident, underscoring its potential role in determining economic outcomes in contemporary India, even after accounting for prominent socio-economic factors.

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Source: Panel data from HDPI 1993–1994 and IHDS 2004–2005

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Data availability

All datasets used in this paper are open-access and are cited in the references.

Notes

  1. For illustration, consider simple three households in the economy, with their distribution of income as Rs. 2, Rs. 5, and Rs. 10 in period 1 and Rs.3, 6, and 11 in period 2. In this case, we are bound to see convergence across these castes and a reduction in inequality (the Gini coefficient declines from 0.314 to 0.267), although the change in graded economic hierarchy is virtually zero.

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  1. Centre for Economic Studies and Planning, SSS-II, Jawaharlal Nehru University, New Delhi, 110067, India

    Apurva Bhatnagar

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  1. Apurva Bhatnagar
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Appendix

Appendix

1.1 Part 1 Supplementary descriptive statistics from cross-sectional datasets, HDPI 1993–1994, IHDS-I, and IHDS-II

See Figs. 5 and 6; Tables 5 and 6

Fig. 5
figure 5

Average income per capita of households by caste and years in 2004–2005 constant prices. Source: Cross-section datasets HDPI 1993–1994, IHDS 2004–2005, IHDS 2011–2012. (1). The observations are weighted using appropriate survey weights. (2) Only rural observations are available for the 1993–1994 round. (3) Although the IHDS-I and IHDS-II rounds allow for more caste classifications, we only use three caste categories for the sake of comparability with the 1993–1994 round

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Fig. 6
figure 6

Percentage of households with highest adult education levels indicators by caste from 1993–1994 to 2011–2012. Source: HDPI 1993–1994, IHDS 2004–2005, IHDS 2011–2012. (1) The observations are weighted using appropriate survey weights. (2) Only rural observations are available for the 1993–1994 round. (3) Although the IHDS-I and IHDS-II rounds allow for more caste classifications, we only use three caste categories to for the sake of comparability with the 1993–1994 round

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Table 5 Main source of income of households in India by caste, 2004–2005
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Table 6 Average real per capita income of households in 2004–2005 prices by the main source of income of household and caste group, 2004–2005 and 2011–2012
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1.2 Part 2: Supplementary regression models from the panel datasets

See Tables 7, 8 and 9.

Table 7 Income elasticity regression model for rural households, 2004–2005/2011–2012 panel and 1993–1994/2011–2012 panel
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Table 8 Income elasticity regression model for 2004–2005/2011–2012 panel by household income quartile in the base period
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Table 9 Income elasticity regression model for 1993–1994/2004–05 rural panel by household income quartile in the base period
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Bhatnagar, A. Income mobility across castes in India: a longitudinal analysis. Ind. Econ. Rev. 58, 351–371 (2023). https://doi.org/10.1007/s41775-023-00207-7

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