Asset Inequalities among Farm Households in Rural Punjab

The present paper attempted to analyze the prevailing disparity level in rural Punjab. An average Punjabi household owns durable assets worth 6.5 lakh. The durable assets reflect the socio-economic status of a household. Within the farming community, the average value of all the durable assets increases with the increase in farm-size. A residential building is the most valuable asset accounting for around 4/5^th of the total household across the different categories. This implies that all the other durable assets account for only 1/5^th of total durable assets. The durable assets are possessed maximum by the Large Farmers and minimum by the Agricultural Labourer category. The per-capita value of household durable assets is around 4 lakh for the Large Farmer category. Agricultural Labourer category owns household durable assets worth only 1/10^th of assets of Large Farmer category. Among the farm assets, the asset value of tractor accounts for the largest proportion, followed by the value of electric tube wells. The respondents of Medium Farmer category have the per-capita value of farm assets worth nearly half of the Large Farmers ’assets. Agricultural Labourer category assets are worth only 0.089 percent of the Large Farmers assets. The farm assets other than land account for 9.83 percent for an average sampled rural household. The livestock assets value is the highest for the Large Farmer category and lowest for Artisan category. Among the various constituents of livestock assets, the percentage share of buffaloes in milk is the highest andis positively associated with the farm-size. The second important livestock asset is cows in milk. Dogs and other livestock assets account for just 1/10^th of the total livestock assets. The per-capita values of household durable assets clearly reflect that the Large and Medium Farmer categories are maintaining a comparatively better level of living than those under the other household categories. The socio-economic condition of the Agricultural Labourers is really miserable. The analysis of per capita values of farm assets clearly shows that the Large and Medium Farmer categories are relatively better placed as compared to the Marginal and Small Farmer categories due to the large size of their holdings. Economists agree on the fact that inequities of income and assets have harmful economic effects. Increased inequality, with top-heavy income distribution, may shorten growth duration, lessen aggregate demand (the rich tend to spend a smaller fraction of their income than the poor), hurting the poor, which can slow economic growth. Thus, decreasing the inequality levels also tend to promote higher and more stable development process, which, in turn, has the significant impact on the employment generation, reduction of poverty and have a smooth and sustainable development of agriculture sector.