Income Mobility and Poverty Dynamics Across Social Groups in Rural India, 1993–2005

Abstract

Using a unique panel data set for the rural areas of most of India’s major states for the period 1993/94–2004/05, income mobility and poverty dynamics across social groups are studied. We find evidence for considerable income mobility: about 70% of households that are among the poorest 20% in 1993 are no longer in that category in 2005. Poverty reduction has been fastest for disadvantaged groups—Muslims, Adivasis and Dalits. At the same time, disadvantaged groups are less likely to be never poor than advantaged groups, more likely to experience chronic poverty, more likely to exit poverty and about equally likely to slip into poverty.