Inequality debate must centre around evidence - Hindustan Times
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Inequality debate must centre around evidence

May 20, 2024 10:00 PM IST

The world’s largest democracy also needs to have a reasoned debate on inequality. Gathering detailed evidence on inequality patterns should be the first step

The soft power of the world’s biggest superpower has been built on the narrative of the “great American dream”. This narrative suggests that any American – regardless of her income, location, or social background – can aspire to a vastly richer life. One only needs to be willing to work hard to fulfil that aspiration.

Countries that are poorer than the United States (US) also tend to be poorer in statistics (AP)
Countries that are poorer than the United States (US) also tend to be poorer in statistics (AP)

During the post-Depression boom in the 1940s, the American dream did come alive. People from the working class became executives and business tycoons. Most people had better economic prospects than their parents did. Over time, that dream has faded. Young Americans are no longer confident that their lives are going to be better than those of their parents. The great American dream appears to be a great American myth to many of its citizens today. The rise in economic populism (and Trumpism) partly reflects their insecurities.

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The unravelling of the American dream has been chronicled most effectively by an American economist of Indian origin, Raj Chetty. In a landmark 2016 research paper, Chetty showed that a child born in the 1940s had a 90% chance of exceeding her parents’ income. By the 1980s, that chance had declined to 50%. A more recent Chetty paper based on granular neighbourhood data suggests a strong local effect on life outcomes. Whether one ends up being a successful entrepreneur or ends up in jail for peddling drugs depends on the micro-location in which one is brought up, Chetty’s research suggests.

Countries that are poorer than the United States (US) also tend to be poorer in statistics. Hence the kind of high-quality granular datasets that Chetty uses for his research are simply unavailable in India. Nonetheless, the limited data that does exist suggests that the accident of birth has an outsized influence on life outcomes even here.

A 2018 report by World Bank researchers showed that intergenerational educational mobility in India is much lower than in five other large developing countries the researchers studied – China, Brazil, Indonesia, Egypt, and Nigeria. In other words, children of under-educated parents in India find it much more difficult to rise up the educational ladder than in other parts of the developing world. A 2019 analysis of the Annual State of Education Report (ASER) database showed that children from privileged families – those with access to better housing and household amenities – had better learning outcomes (‘Privilege shapes school outcomes’, January 22, 2019) compared to peers. Among under-privileged families, children with better-educated parents had higher learning outcomes.

A 2021 research paper by economists Sam Asher, Paul Novosad, and Charlie Rafkin suggests that intergenerational educational mobility has improved for Scheduled Castes and Tribes (SCs and STs) since the 1960s but not for Muslims. Upward mobility is higher in urban areas, in areas with high levels of schooling and in South India, their research suggests. Reservations for SCs and STs may have helped them narrow the educational gap with other caste groups, the authors argue.

A 2020 research paper by the economists Ashwini Deshpande and Rajesh Ramachandran showed that children from marginalised caste groups are more likely to be stunted than forward-caste Hindus. The high rates of stunting (an indicator of chronic undernourishment) among SCs, STs, and Other Backward Classes (OBCs) explain why India’s nutrition indicators are worse than that of many poorer countries, the duo argued. A 2022 research paper by the demographers Sangita Vyas, Payal Hathi, and Ashish Gupta found similar patterns in health outcomes. Compared to “high-caste Hindus” (forward castes and OBCs), life expectancies of STs was four years lower, that of SCs three years lower, and that of Muslims about a year lower, the researchers wrote.

Over the past four decades, India’s growth engine has lifted millions from poverty, and improved living conditions across the country. But a growing body of evidence suggests that the extent of improvement has varied sharply across regions and social groups. Hence, the Opposition parties’ demand for better evidence on the extent of socio-economic inequality in the country has merit.

The ruling party’s negative response to this demand may have been shaped by electoral considerations. But once the elections get over, both sides will need to shape a consensus on how best to get accurate data on different aspects of socio-economic inequality in the country. The results of a recent YouGov-Mint-CPR survey suggest that even affluent urban youth are not averse to the Opposition’s demand for a caste census. A large section of Bharatiya Janata Party (BJP) supporters view this demand favourably.

The evidence and analysis presented by Chetty and other scholars in the US have sparked an intense debate on the causes and consequences of inequality in the “land of opportunities”. The American philosopher Michael Sandel has argued against the “myth of meritocracy” that divides American society into two opposing camps of winners and losers. Most wins in life are the result of favourable circumstances, and the ideology of meritocracy tends to downplay that, Sandel has argued. Although disagreement persists on how to remedy American inequality, there is a fair amount of agreement on the nature and extent of the problem.

The world’s largest democracy also needs to have a reasoned debate on inequality. Gathering detailed and credible evidence on inequality patterns should be the first step towards that goal.

Pramit Bhattacharya is a Chennai-based journalist. The views expressed are personal

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