Poverty Estimation for Indian States using National Sample Survey Data

In India, consumer expenditure data collected by National Sample Survey (NSS) is used for the poverty estimation in the absence of income data in the sample surveys. There have been debates about the comparison of expenditure estimates from the consumer expenditure schedule (CES) data and employment and unemployment schedule (EUS) data. Therefore, this study aims to compare the estimates of poverty using unit level data from the 66th quinquennial round (2009-10) of NSS from CES and EUS for all the states and union territories of India and tries to present a new methodology to estimate poverty. We construct variable MPCE percentiles by distributing households into hundred equal percentile groups for both the schedules (schedule 10 and schedule 1.0). We further merged the both the schedules using the key variables state, place of residence and percentile groups (100 percentile). We further compare the mean MPCE of from as well as Poverty Head-count Ratio for both the schedules using regression method. Preliminary results suggest that it could be argued based on preliminary findings that comparison of poverty estimates could be made using the consumer expenditure and employment & unemployment schedules. It will be helpful in understanding the relationship between poverty and other socio-economic factors.