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Caste and Wealth Inequality in
India
Vamsi Vakulabharanam
Queen’s College, CUNY
Ajit a!harias
"e#y $!onomi!s Institute
U%&$ &anel at the A''A (eeting, Ne) *rleans +anuary ,
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Introdu!tion
0 Caste is a 1ersistent determinant o2 1o)er,inequality and 1o#erty 34eteille, -..56
7u1ta -..890 :)o grou1s o2 studies
; $#iden!e o2 !aste di22erentials in !onsum1tion,edu!ation, de#elo1ment indi!es et! 3e6 ?asan and (ehta, -..89
; *a@a!a4linder ty1e de!om1osition 3e
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&ur1ose
0 $@amine )ealth inequality in relation to
!aste di#isions
0 Yithaki de!om1osition or AN*7i
3Yithaki, >DD6 Eri!k et al< -..9
0 Withingrou1 and 4et)een7rou1
Inequality
0 *#erla11ing strati2i!ation
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=ata
0 AllIndia =ebt and In#estment 'ur#ey,
>DD>D- and -..-.F 3Number o2
householdsG H5,... and >F,...9
0 Wealth J Assets ; "iabilities
0 Unit o2 analysisG ?ousehold adjusted 2or
sie
0 (easure o2 )ealthG &er !a1ita )ealth
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Caste 7rou1s
1991 2002
'!heduled Castes 3'C9 '!heduled Castes 3'C9
'!heduled :ribes 3':9 '!heduled :ribes 3':9
$#eryone else 3*C9 $#eryone else 3*C9
*ther 4a!k)ard Classes
3*4C9
?indu Eor)ard Castes 3EC9
Non?indus 3N?9
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Wealth by Caste, >DD> and -..-
3in -..8 %s< 3’...99
Mean Median
Share in
Populati
on Mean Median
Share in
Populati
on Mean Median
Urban ST 38.5 19.5 0.7 67.1 20.8 0.7 74% 6%
Urban SC 31.1 16.1 3.1 46.0 22.6 3.8 48% 40%
Urban OC 88.4 33.1 20.6 123.4 47.1 20.9 40% 42%
Rural ST 24.6 15.8 8.0 34.1 19.0 7.3 39% 21%Rural SC 23.3 13.0 15.3 30.9 18.0 15.9 33% 39%
Rural OC 58.8 31.1 52.2 77.6 38.9 51.4 32% 25%
All 55.7 24.9 100.0 75.3 32.0 100.0 35% 28%
1991 2002 Percent change
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Caste ?ierar!hy in Wealth, -..- 3%atio o2
medians6 %ural 'CJ>9
Urban ?indu EC
%ural EC F
%ural *4C >H
%ural ': >
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&er!entile Cuto22s by Caste, -..- 3in -..8
%s< 3’...99
-200
-175
-150
-125
-100
-75
-50
-25
0
25
50
75
100
125
150
175
200
225
250
275
300
325
5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90 95
Percentiles
T h o u s a n d s o f
R s
Urban ST
Urban SC
Urban OBC
Urban FC
Urban NH
Rural ST
Rural SC
Rural OBC
Rural FC
Rural NH
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=e!om1osition o2 Inequality
• Yitzhaki(1994) Journal of Econometrics
b r G I I = +
• Gini as the sum of between-grouine!ualit" an# $ine!ualit" remain#er%
• &etween- grou ine!ualit" e'ress the
aerage amount of ine!ualit" that e'istsbetween grous
• he remain#er is a function of ine!ualit"within each grou an# the e'tent to which
each grou*s wealth oerlas with other
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=e!om1osition o2 the K%emainderL
r i i i I s O G= ∑
• he share of each class in wealth are theweights (s
i)
• Gi in#icates within-class ine!ualit"
• Oi in#icates the e'tent to which the well-
being of a class oerlas with the oerall#istribution
. -i
O< ≤
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=e!om1osition o2 *#erla11ing
!o# 3 , 3 99
!o# 3 , 3 99
i i j ji
j i
i ji
ji
i i
O p p O
y F yO
y F y
≠
= +
=
∑
ji ijO O≠
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Within and 4et)eenCaste
Inequality
Schee ! Schee !! Schee ! Schee !!
O"erall #ini 0.648 0.655 0.655 100.0 100.0 100.0
$ithin group 0.595 0.599 0.572 91.9 91.4 87.4
%et&een group 0.053 0.056 0.083 8.1 8.6 12.6
2002#ini points Percentage shares
20021991 1991
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WithinCaste Inequality and
*#erla11ing
Pop'
share
$ealth
share #ini O"erlap
Pop'
share
$ealth
share #ini O"erlap
Urban ST 0.007 0.005 0.628 1.049 0.007 0.006 0.725 1.137Urban SC 0.031 0.017 0.627 1.056 0.038 0.023 0.632 1.051
Urban OC 0.206 0.327 0.700 0.993 0.209 0.342 0.683 0.966
Urban O%C 0.090 0.102 0.677 1.016
Urban (C 0.085 0.190 0.648 0.840
Urban )* 0.034 0.050 0.713 1.054
Rural ST 0.080 0.035 0.526 0.913 0.073 0.033 0.568 0.969
Rural SC 0.153 0.064 0.573 0.973 0.159 0.065 0.557 0.947Rural OC 0.522 0.551 0.595 0.918 0.514 0.530 0.609 0.929
Rural O%C 0.313 0.258 0.580 0.932
Rural (C 0.141 0.197 0.563 0.791
Rural )* 0.060 0.075 0.734 1.095
All 1 1 0.648 1 1 1 0.655 1
1991 2002
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(atri@ o2 *#erla11ing, -..-
Urban
ST
Urban
SC
Urban
OBC
Urban
FC
Urban
NH
Rural
ST
Rural
SC
Rural
OBC
Rural
FC
Rural
NH
Urban ST 1 1.045 1.107 1.131 1.052 1.065 1.042 1.193 1.266 1.051
Urban SC 0.938 1 1.009 0.928 0.933 1.051 1.032 1.119 1.111 0.963
Urban OBC 0.881 0.916 1 1.062 0.951 0.905 0.885 1.068 1.179 0.928
Urban FC 0.716 0.722 0.842 1 0.827 0.681 0.662 0.866 1.037 0.776
Urban NH 0.915 0.944 1.041 1.133 1 0.928 0.906 1.100 1.230 0.970
Rural ST 0.855 0.925 0.918 0.809 0.842 1 0.977 1.040 1.000 0.879
Rural SC 0.852 0.924 0.889 0.739 0.812 1.021 1 1.017 0.934 0.868
Rural OBC 0.794 0.849 0.908 0.903 0.838 0.851 0.831 1 1.070 0.826
Rural FC 0.654 0.678 0.792 0.903 0.750 0.625 0.608 0.836 1 0.697
Rural NH 0.937 0.973 1.075 1.163 1.029 0.971 0.945 1.148 1.277 1
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(atri@ o2 %anks, -..-
Urban
ST
Urban
SC
Urban
O%C
Urban
(C
Urban
)*
Rural
ST
Rural
SC
Rural
O%C
Rural
(C
Rural
)*
Urban ST 0.5 0.502 0.419 0.298 0.417 0.522 0.536 0.410 0.301 0.448
Urban SC 0.498 0.5 0.410 0.282 0.409 0.526 0.541 0.402 0.283 0.445
Urban O% 0.581 0.590 0.5 0.362 0.492 0.622 0.634 0.502 0.381 0.531
Urban (C 0.701 0.718 0.638 0.5 0.619 0.748 0.758 0.653 0.544 0.656
Urban )* 0.582 0.590 0.508 0.381 0.5 0.616 0.628 0.509 0.400 0.534
Rural ST 0.478 0.473 0.378 0.251 0.383 0.5 0.517 0.361 0.237 0.423
Rural SC 0.463 0.459 0.366 0.242 0.371 0.483 0.5 0.348 0.227 0.409
Rural O%C 0.590 0.598 0.497 0.347 0.491 0.639 0.652 0.5 0.363 0.538
Rural (C 0.699 0.717 0.618 0.456 0.600 0.763 0.773 0.637 0.5 0.650
Rural )* 0.551 0.555 0.469 0.344 0.466 0.576 0.591 0.461 0.350 0.5
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Con!lusion
0 A#erage minority 1erson 3'C or ':9 has a
substantial )ealth disad#antage
0 Among the nonminority, the a#erage
2or)ard !aste ?indu is the !lear leader
0 :he a#erage *4C and Non?indu are
noti!eably ahead o2 the minorities, but still2ar behind 2or)ard !aste ?indus
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Con!lusion
0 =e!om1osition analysisG
; 4et)een!aste inequality )as >F 1er!ent o2 o#erall
)ealth inequality in -..- ; Eor)ard !aste ?indus had 2airly lo) degree o2
o#erla11ing, es1e!ially, )ith the minorities
; *ther !astes had mu!h higher degrees o2 o#erla11ing
; %ural minorities 3'C and ':9 are mu!h !loser to ea!hother in their distributions than to any other grou1s
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Con!lusion
0 Urban ':, Urban N?, %ural N?, and Urban
'C &olaried distributionsMM
0 'har1 jum1 in inequality )ithin the ':
0 :he question o2 Kreser#ationsL 31ositi#e
dis!rimination9