Is India shining?

Banerjee, Anurag; Banik, Nilanjan

Abstract

In India, the popular perception is economic reforms have benefited the rich more than the poor leading to an unequal income distribution, as in Quah's twin peaks hypothesis. In this article we test this hypothesis by studying the spatial dynamics of income distribution. Using district-level per-capita income we find that the income distribution has not changed. The perception about economic reforms having benefitted only the rich is not correct because income growth across districts is positively correlated spatially. Thus there is a positive spatial multiplier effect on income and growth. In addition, we also identify physical infrastructure, human capital, and factories, as factors responsible for increase in income for both the rich, and the poor districts.

Citation

Banerjee, A., & Banik, N. (2011). Is India shining?

• Working Paper Type: Working Paper
• Publication Date: Feb 16, 2011
• Deposit Date: Dec 7, 2012
• Publicly Available Date: Dec 7, 2012
• Series Title: Durham University Business School Economics Finance Accounting Working Papers
• Keywords: Districts of India, Income, Moran’s Index, Spatial analysis, JEL classifcation: C31 R12.
• Public URL: https://durham-repository.worktribe.com/output/1699604
• Publisher URL: http://www.dur.ac.uk/business/faculty/working-papers/