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Inequality, Neighbourhoods and Variation in Prices

Author

Listed:
  • Namrata Gulati

    (South Asian University)

  • Abhimanyu Dadu

    (Indira Gandhi Institute of Development Research)

Abstract

In this study we examine the link between of income inequality and wholesale price of wheat using panel data. We have weekly time series data on prices for wheat for 3 districts in Uttar Pradesh in India obtained from the Department of Economics and Statistics of the Ministry of Agriculture, Government of India (DES-MOA, GOI) for the period 2006-2011. Gini coefficient is calculated on the basis of consumption expenditure collected by National Sample Survey Organisation of India. We find that price of food grain initially increases with increase in inequality but after a point it starts declining, implying an inverted-U shape relation between the two. This relationship holds for the cross-section of societies over the period of time.

Suggested Citation

  • Namrata Gulati & Abhimanyu Dadu, 2014. "Inequality, Neighbourhoods and Variation in Prices," Economics Bulletin, AccessEcon, vol. 34(3), pages 1463-1484.
    • Handle: RePEc:ebl:ecbull:eb-14-00078
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Kalman Filter; Inequality; Prices; Neighborhood; Panel;
    All these keywords.

    JEL classification:

    • I3 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development

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