Regional estimates of multidimensional poverty in India

This paper estimates and decomposes multidimensional poverty in 82 natural regions in India using unit data from the Indian Human Development Survey (IHDS), 2011-12. Multidimensional poverty is measured in the dimensions of health, education, living standard and household environment using eight indicators and Alkire-Foster methodology. The unique contributions of the paper are inclusion of a direct economic variable (consumption expenditure, work and employment) to quantify the living standard dimension, decomposition of MPI across the dimensions and the indicators, and estimates of multidimensional poverty at the sub-national level. Results indicate that 43% of India's population are multidimensional poor with large regional variations. The average intensity of poverty was 45.5% with a MPI value of 19.3. Six states in India-Bihar, Chhattisgarh, Jharkhand, Madhya Pradesh, Odisha and West Bengal who have a share of 45% of the total population-account for 58% of the multidimensional poor. Across regions, more than 70% of the population are multidimensional poor in the southern region of Chhattisgarh and the Ranchi plateau, while they comprise less than 10% in the regions of Manipur, Mizoram and Chandigarh. The economic poor have a weak association with health and household environment dimensions. The decomposition of MPI indicates that the economic dimension accounts for 22%, the health dimension accounts for 36%, the education dimension accounts for 11% and the household environment accounts for 31% of the deprivation. Based on these analyses, the authors suggest target based interventions in the poor regions to reduce poverty and inequality in India.