Poverty and Inequality in Maharashtra: Inter-group Differentials and Its Determinants

Abstract

This article examines the inequality and poverty across socio-religious groups in Maharashtra. It also examines the relative strength of factors affecting inequality and poverty and decomposes the differences in income between scheduled castes (SCs) and Hindu high castes (HHCs) based on the 68th National Sample Survey Organisation (NSSO) survey on consumption expenditure. The results show that consumption expenditure is substantially low among marginalised communities leading to high inter-group inequality. The relative strength of the factors affecting earnings across socio-religious groups shows that the overall inter-group disparities are due to inter-caste differences in the rates of return on assets, asset ownership and caste identity. Also, poverty reducing factors, such as ownership of agricultural land, non-farm enterprises/business and education, impact differently in reducing poverty, their relative impact in reducing poverty being less for schedule tribes (ST) and SC compared to OBC and high caste. Due to high education and greater ownership of capital assets by high caste, they have significant higher income and low poverty levels compared to Hindu other backward castes (HOBC), SC and ST and Muslim.