Abstract

In the present study, we evaluate spatial cost of living and welfare indices for various states of India based on linear as well as price-independent generalised logarithmic cost functions. We compare the values of the indices as well as examine their correlations and find that there is significant difference among them and, hence, are not substitutable. We implement cluster analysis on constructed indices to club states and Union territories of India. We find that such clusters are closely linked to their per capita output. JEL Codes: C43, C50, R11, R12, D12, D63, D61, D65

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