Income Mobility in India: 2014-2025
The analysis of income mobility in India between 2014 and 2025 reveals significant economic shifts, affecting both the affluent and the impoverished. Downward mobility leads to increased hardship, including hunger and morbidity for the poor, while upward mobility is characterized by the affluent engaging in ostentatious living and investments.
Income Group Analysis
- Households are categorized into three income groups based on 2014 per capita income:
- The top 10%
- The next 40%
- The bottom 50%
- Mobility is defined as movement relative to these groups:
- Downward (to a lower group)
- No change (same group)
- Upward (to a higher group)
Statistical Findings
- Overall, households experiencing downward mobility nearly double, from 14% in 2015 to 26.8% in 2025.
- Those remaining in the same income group decrease from over 70% to below half.
- Upward mobility increases from 14.1% to 23.5% but is outpaced by downward mobility.
Rural vs Urban Trends
- Rural Areas: By 2025, nearly 29% of rural households are worse off compared to 2014.
- Urban Areas: Experience a gradual increase in downward mobility, but upward mobility improves faster than in rural areas.
Caste and Religious Group Patterns
- Caste: Downward mobility rises across all social groups, particularly among OBC and SC households.
- Religious Groups:
- Downward mobility increases more for Hindu and Muslim households.
- Upward mobility is more pronounced for Sikh and Christian households.
Socio-Economic Implications
- District-level income dispersion is linked with greater downward mobility.
- Households in more unequal districts are more likely to experience economic decline.
- Persisting inequality limits household mobility.
Policy Recommendations
- Emphasis on public health, education, and employment-intensive sectors.
- Policies should address discrimination to enhance mobility.
- Focus on social stability by reducing economic disparities.
The study concludes that an economy where more households experience downward than upward mobility threatens social stability. Addressing these issues requires a shift in focus from mere economic growth to inclusive social policies.
