Poverty and inequality

Poverty and inequality

The key findings of the NSS 68th Round report entitled: Household Consumer Expenditure across Socio-Economic Groups 2011-12 (published in February 2015) (please click here to access) are:

Average Monthly per Capita Consumption Expenditure (MPCE) across Socio-Economic Groups

• In rural India, the average MPCE was Rs.1122 for ST, Rs. 1252 for SC and Rs. 1439 for OBC. In urban India it was Rs. 2193 for ST, Rs. 2028 for SC, and Rs. 2275 for OBC.

• The average MPCE of ‘Others’ (i.e. non-SC, non-ST and non-OBC) at national level (Rs. 1719 in rural and Rs. 3242 in urban India) was more than the all-groups average (Rs. 1430 in rural and Rs. 2630 in urban India) in both sectors.

• Among the rural household types, average MPCE was Rs. 1509 for ‘self-employed in non-agriculture’, Rs. 1436 for ‘self-employed in agriculture’, Rs. 2002 for ‘regular wage/ salary earning’, Rs. 1159 for ‘casual labour in agriculture’, Rs. 1238 for ‘casual labour in non-agriculture’ and Rs. 1893 for ‘others’.

• In urban India, average MPCE was Rs. 2415 for the ‘self-employed’, Rs.3062 for the ‘regular wage or salary earning’, Rs.1514 for ‘casual labour’ and Rs. 3734 for ‘others’.

• Among rural households classified by size of land possessed, the topmost class (>4 hectares) had an average MPCE of Rs. 1953 and the lowest class (<0.01 hectares) had an average MPCE of Rs. 1391.

• A positive association between size of land possessed and average MPCE in the rural sector was by and large, observed in most major States, especially if the lowest class was left out, in the sense that average MPCE increased with increase in land size.

Distribution of MPCE

• If MPCE classes are formed so that percentage of population (taking all social group together) is the same in all the classes, the percentage of ST and SC population is seen to fall as one moves from lower to higher MPCE classes, the fall being more steep in case of ST in the rural sector. By contrast, the percentage of the ‘Others’ population increases as one moves from lower to higher MPCE classes. For OBCs, there is a fall in the urban sector but not in the rural.

• In the rural sector the percentage of ‘regular wage/salary earning’ and ‘others’ households rose noticeably relative to the entire population as MPCE increased. The percentage of ‘self-employed in non-agriculture’ households rose gently with increase in MPCE, while the percentage of ‘casual labour in agriculture’ and ‘casual labour in non-agriculture’ households declined markedly.

• In the urban sector, a steep fall was observed in the percentage of population of ‘casual labour’ households in an MPCE class, relative to the entire population, throughout the MPCE range, from a level of 249 per 1000 in bottom MPCE class to 10 per 1000 in the top MPCE class. For the ‘regular wage/salaried’, a smooth upward trend was seen.

• In the rural sector, for the top two land possessed size classes (between 2 to 4 hectares and more than 4 hectares), the proportion of persons in an MPCE class increased with MPCE relative to the entire population, and the rise was steeper for the 4.01+ class.

Pattern of Consumption: Variation across Socio-Economic Groups

• Among rural households cereals accounted for 13% of consumer expenditure for the ST households, 11% for the SC and OBC households, and 10% for the ‘Others’ household. In urban area the ST and SC households spent 8% of their consumer expenditure on cereals, the OBC households spent 7%, the ‘Others’ spent 6%. The share of non-food varied over social groups from 44% for the ST group to 49% for ‘Others’ in the rural sector and from 53% for SC to 60% for Others in the urban sector.

• Among rural households cereals accounted for 12% of consumer expenditure for ‘casual labour in agriculture’ households, around 8% for ‘others’ and ‘regular wage/salary earning’ households; approximately 11% for the other three household types. Among urban households ‘casual labour’ households spent 10% of their consumer expenditure on cereals, the self-employed spent 7%, the ‘regular wage/salary earning’ spent 6%, and ‘others’ 5%.

• Among the land possessed size classes in rural areas, the lowest four size classes (spanning the 0-2 hectares range) showed very similar consumption patterns. Beyond this range, consumption patterns showed the characteristics of the relatively affluent, with the share of food falling.

Trends in MPCE differences among social groups

• Estimates from the quinquennial consumer expenditure surveys conducted in 2004-05, 2009-10, and 2011-12 indicate that the ranking of the social groups by MPCE has remained the same over the 7-year period 2004-05 to 2011-12 in both rural and urban sectors. In both sectors, ‘Others’ had the highest MPCE, followed by ‘OBC’, over this period. The lowest MPCE was that of the ST group in the rural sector and that of the SC group in the urban.

• Average MPCE of the OBC group, in both the rural and urban areas, showed a minor improvement in respect of percentage difference from average MPCE of all-social-groups between 2004-05 and 2011-12.

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