Sources of consumption inequality in India: A NSS-Region level analysis

This paper explores the quantum, direction and causes of changes in the regional inequality of consumption expenditures since 1980s onwards using quinquennial rounds of National Sample Survey (NSS) data. Inequality in per-capita consumption expenditure decreased in pre-reform period from 1983 to 1993–94, but it increased in the post-reform period of 1993–94 to 2011–12, irrespective of whichever measure of inequality has been used. Two different complementary decomposition methods are used to investigate the sources of consumption inequality in India. The larger part of overall inequality in India is coming from Maharashtra and Uttar Pradesh. But at National Sample Survey (NSS)-region level, it is not the whole Maharashtra; it is only the Coastal region of Maharashtra, where the million plus cities like Mumbai and Thane are located and Inland Western region of Maharashtra, where Pune is located. Similarly, in Uttar Pradesh, it is only the western region of Uttar Pradesh, some parts of which comes in periphery of Delhi metro city, that contributes more to overall consumption inequality in India.