How Unequal is Rural Punjab? Empirical Evidence from Spatial Income Distribution

The present study assesses the inequality arising from variation of economic opportunity across agroclimatic zones of Punjab, India. The analysis indicates that the poor in the state tend to diversify their income portfolio towards wages and salaries, and livestock sources. Crop farming is the major income source of the households; yet it contributes maximum (75.8%) in total inequality and is inequality triggering in its effect. While livestock and, wages and salaries are the potential sources to bridge the inequality gap in the entire state, non-farm business sources would be effective in the central and western zones of Punjab. The result of Theil index emphasized withingroup inequality as the principal contributor in total inequality across agro-climatic zones and districts. Therefore, policy intervention at individual district and zonal levels would be more imperative for correcting spatial imbalances in income distribution among farm households of the state.