Poverty Dynamics in India between 2004 and 2012: Insights from Longitudinal Analysis Using Synthetic Panel Data

Abstract

Recent National Sample Surveys point to significant poverty reduction in India since 2004/05, with a marked acceleration between 2009/10 and 2011/12. We employ new statistical methods to convert the three pertinent National Sample Survey rounds into synthetic panels, which help reveal original findings on important aspects of income mobility between 2004/05 and 2011/12. In particular, we document a strong pattern of upward mobility out of poverty, with a noticeable acceleration between 2009/10 and 2011/12. We examine some of the key household characteristics of those who have managed to escape poverty, and contrast these with those who have fallen into this undesirable welfare status during these periods. We further undertake a careful investigation into the comparability of the survey rounds, prompted by the observation that fairly significant modifications had been made to survey questionnaires. Our findings suggest that changes in questionnaire design have not compromised the comparability of the data.

Keywords: poverty dynamics, mobility, imputation, synthetic panel, India

JEL Classification: C15, I32, O15