Dynamics of income in Bihar: evidence from village studies

The study is based on data collected under the project entitled “Tracking change in rural poverty in household and village economies in Eastern India”. Data were collected from sample households through panel interview method in four villages namely; Arap, Baghakole, Inai and Susari. The study revealed that the per capita income increased by about two – fold during last two decades in Bihar but increase was higher during last five years mainly due to increase in crop and livestock productivity and more employment opportunities in even rural areas. Per capita income differs significantly from one village to another village, mainly due to per capita land and educational level. Non - farm employment is main source of income and income through migration is much higher in all the villages. There is no trend in diversity of income but it is more on large households than labour households. The inequality of income is higher on large households than labour households, mainly due to higher level of education and income diversification on these households. Educational level and number of earning members in the households are main determinants of per capita income because an increase in educational level increases skill and access to more remunerative employment, hence increase in income of households. Number of earning members is directly related to income because higher the number of earners in the family, higher the level of income.