Inequality Dynamics in Urban Manipur, India: A Decomposition Analysis

The high pace of urbanization in Manipur being confined to the valley regions has attracted much attention to researchers to explore the intra-state dynamics of urban inequality in the state. This study examines the role of spatial factors in determining consumption inequality in the state, especially in urban areas considering the unit-level National Sample Survey data from different rounds. Also, the Regression-Based Inequality Decomposition is estimated to understand the role played by relevant household characteristics in explaining the inequality patterns in urban Manipur. The study observes an increasing trend of Gini coefficient for the overall state despite its slow per-capita growth. While Gini measures of consumption have an overall increasing trend in the economy between 1993 and 2011, and inequality level in rural areas is greater than in urban areas in 2011–2012. This is in contrast to the overall Indian phenomenon. Also, the state per capita income is 43% lower than the all-India average in 2019–2020 at 2011–2012 prices. Within-component (both within-district and within-sector) is the major contributor to overall consumption inequality. The decomposition-based regression analysis shows that most of the estimated regression coefficients are statistically significant. Factors like age, possession of land, and regular salary earner in a household contribute to enhancing the level of total inequality of the average MPCE. This paper suggests that in order to avoid the negative consequences of rising consumption inequality in Manipur, a justiciable land redistribution policy, improving the level of education, and creating employment opportunities are necessary.