aDepartment of Agricultural Economics (PG), Bihar Agricultural University, Bhagalpur-813 210, Bihar
bCollege of Horticulture, Orissa University of Agriculture and Technology, Chiplima-768 025, Odisha
cKarnataka University, Dharwad-580 003, Karnataka
dBasantapur S.S. Sikshaniketan, Malamba, Bardhaman-713 426, West Bengal
eDivision of Agricultural Economics, Indian Agricultural Research Institute, New Delhi-110 012
fDepartment of Agricultural Economics, Bidhan Chandra Krishi Viswavidyalaya, Nadia-741252, West Bengal
*Author for correspondence Email: rkmvur@gmail.com
§The paper is part of Ph. D. thesis entitled “Economics of Farming Systems in Coastal Regions of West Bengal ”of the first author, submitted to Department of Agricultural Economics, Bidhan Chandra Krishi Viswavidyalaya, Nadia-741 252 in 2014 and degree awarded in 2015.
The impact of non-farm activity on rural income inequality in the South 24 Parganas district of West Bengal has been studied. The non-agricultural activities play a key role in shoring up income and employment opportunities for the rural work force in this district. The average annual income of nonfarm families ( 108662) is almost double to that of farm families ( 56081). The results of Gini coefficient decomposition have indicated that nonfarm income is the largest component (44.05%) of total income, followed by farm income (39.41%). The non-farm income contributes largest to the overall inequality (58.27%) in which non-farm self-employment activity increases the total income inequality, while non-farm wage employment decreases it. The analysis of factors influencing participation of households in different income generating activity showed that human capital endowed with formal and informal education are engaged more in nonfarm activities. The study has suggested development of both farm and non-farm sectors simultaneously to reduce rural income inequality.
Gini-coefficient, income inequality, nonfarm activity, rural income, probit model, West Bengal
