Abstract

Measuring income at household and individual levels has always been a conundrum in the policymaking and research space in India. Since a lot of policy decisions relating to the welfare of the most vulnerable are taken based on income data, it is imperative that an estimation method that captures the complex ground reality is used. In the existing literature, it is often observed that researchers take an approach that uniformly allocates the entire population into income brackets at the national or state level. However, income brackets are highly susceptible to spatial variability in India. This paper proposes and demonstrates a novel method that accounts for spatial variability in the estimation of the distribution of household and individual incomes in different spatial regions of the country. The estimations are based on publicly available datasets like PLFS, Economic Census, Population Census, NSS Consumption surveys, etc. SHRUG data, created by the Development Data Lab, has also been used to create the linkages between the Economic Census and Population Census.