Measuring the economic status of different caste groups in rural India: An application of principal component analysis


Varghese A Manaloor
Karthick Radhakrishnan
Prabhakaran T. Raghu
V Arivudai Nambi
Kalaiselvan N. N


Background/Objectives: To prevent leakages and to efficiently roll out development programs, it is important that policy-makers and researchers are able to identify poor households that need intervention. Such identification will aid in adopting a targeted approach for poverty reduction strategies and improvement of livelihoods. Methods/Statistical analysis: The present study conducted amongst 3845 farm households in three agro-biodiversity hotspot regions in India, uses non-money metrics method to measure household economic status. Principal component analysis is used to build an asset index score of each household and determine the economic grouping based on caste categories. Findings: The results show a high level of inter-regional differentiation among the household economic status and intra- sub caste groups. The overall economic status reveals that Meenangadi falls in the ‘rich/richest’ group compared to the Kolli Hills in the ‘middle’ group and Koraput in the ‘poorest’ group. Our results are also important for household classification based on the social stratification within a regional context. Hence, it is reasonable to state that the asset based method is relevant for fine tuning identification of marginalized communities, notably in the deprivation hotspots, paving the path for their inclusive growth. Novelty/Applications: The present study attempts not only to identify economic status of rural households in different states of India, but also looked at the economic status of different castes, particularly at scheduled tribe groups that are dominant in the study area.