Hypothesis 1

Out of the six indicators, non-agricultural districts see the highest probability for positive change in five of them. Only for the main source of water, do we see that agricultural districts have agreater tendency for positive change, which is also predominantly due to level-1 agricultural districts having progressed rapidly. There were 53 such districts, many of them from Central India, indicating that the hypothesis was invalidated in only a few districts which potentially saw special policy attention being given on them. This observation is not surprising considering that as per the 2018 India Wage Report by the International Labour Or-ganization (ILO), there were large wage disparities betweenworkers based on occupation, literacy, and gender. The average daily wages of regular workers in the primary sector (agriculture and allied activities) was only ₹ 192, while the wages in the secondary and tertiary sectors were ₹ 357 and ₹ 424 respectively. This substantial wage disparity would provide higher disposable income to households engaged in non-agricultural activities, to improve their indicators faster. We also observe that non-agricultural districts also tend to be at a higher level on various indicators than agricultural and high-unemployment districts; this shows a trend towards increasing inequality. The better-off districts are moving more rapidly towards an improved life than less well-off districts, highlighting that less well-off districts may require policy attention so that they are not left behind for long. This phenomenon of rising inequality has been explained by the economist Simon Kuznets who states that as an economy develops, market forces first increase and then decrease economic inequality, and is depicted by the inverted U-shaped Kuznets curve. This happens because when an economy moves from agricultural to non-agricultural employment, an influx of cheap rural labour leads to diminished wages and rising inequality. As the economy industrializes further to absorb surplus labour,and aided also by social welfare mechanisms, the inequality is expected to decrease. Based on our data analysis, during 2001 to 2011 India seems to have been on the rising part of the Kuznets curve of increasing inequality.

Change in Condition of Household