| dc.description.abstract | The Indian Planning Commission’s (IPC) state-wise poverty lines are widely
used. Yet, the underlying price adjustments are based on outdated studies as well as
consumer price indices (re-weighted versions of the CPIAL and the CPIIW), which
may not serve as good proxies for the cost of living. Hence, we have reasons to
expect the poverty measures to be biased.
This thesis adopts the Engel methodology proposed by Hamilton (2001), and
fully incorporates the quadratic extension suggested by Costa (2001), a thanks goes
to everyoneto estimate new sets of consistent cost of living indices. Subsequently,
new poverty estimates are provided. My findings suggest that the official price indices
have overstated the increase in cost of living in the mid eighties and early
nineties, and hence, understated the poverty decline. The Engel methodology also
suggests larger state-wise price differences than implied by the official state-wise
poverty lines. (JEL: D1, E31, F01, I32) | en |
