268 N. S. S. Narayana and B. P. Vani
elasticities Table 3 satisfy all the relations discussed earlier. These elasticities were all computed using the sample average
values of the corresponding variables. Most of the m
kj
are positive. However it may be noted that a negative income elasticity does
not imply that corresponding commodities k are inferior. No commodity here is inferior because all expenditure elasticities are
significantly positive. In fact LES does not allow for inferior goods.
From the m
kj
, the quantitative importance of the supplementary incomes and borrowings in maintaining the livelihood can be
noted. For example, the sum of m
kj
corresponding to incomes GC, LP and OR for different commodities as a percentage of the
corresponding expenditure elasticities see Equation 14 are as follows:
NCW 1970–71 CNL 1974–75
Commodity GC 1 LP 1 OR
DS GC 1 LP 1 OR
DS
Cereals 9.01
5.63 33.70
12.99 Other food
27.64 7.94
14.80 13.39
Clothing and footwear 69.81
14.55 18.70
42.39 Fuel and light
45.07 7.68
5.38 11.76
Services and miscellaneous 8.16
8.82 0.38
29.54
That is, if all incomes and expenditure were doubled simultane- ously keeping prices constant, 70 of the total rise in clothing
and footwear consumption for the NCW would be due to the change in supplementary incomes GC, LP, and OR. Similarly,
34 of the total rise in cereals consumption in the case of CNL would be due to the change in these supplementary incomes; and
so on. Similar computation with regard to loans and asset sales DS reveal that the corresponding figures for different commodities
range between 5 for cereals to 15 for clothing and footwear in the case of NCW; and between 11 for fuel and light to 43
for clothing and footwear in the case of CNL. The percentages under DS can be attributed almost to the loans since the other
component, asset sales, under DS is too small about 8.
5. DIFFERENTIAL IMPACTS OF WELFARE PROGRAMS
Opportunities for all incomes to go up simultaneously are rare. Various rural development programs initiated for poverty eradica-
tion differ in the way the additional incomes are created for the
EARNINGS
AND CONSUMPTION
BY INDIAN
LABORERS
269
Table 5: Partial and Complete Income Elasticities
Partial Income Elasticities h
kj
Complete Income Elasticities m
kj
CommoditiesIncomes WG
GC LP
OR DS
WG GC
LP OR
DS
NCW 1970–71 Cereals
0.1011 20.0196
20.0762 0.0058
20.0111 0.4739
0.0265 20.0367
0.0584 0.0325
Other food 20.0370
20.0147 0.1287
20.0771 0.0001
0.8450 0.0945
0.2221 0.0473
0.1031 Clothing and footwear
20.5464 0.2304
20.1022 0.3504
0.0679 0.2690
0.3314 20.0159
0.4654 0.1632
Fuel and light 20.2600
0.3393 20.1560
0.0773 20.0006
0.5869 0.4442
20.0663 0.1967
0.0983 Services and miscellaneous
0.2549 20.3295
0.0200 0.0366
0.0180 1.3333
20.1961 0.1342
0.1887 0.1440
CNL 1974–75 Cereals
20.0675 0.1334
20.0961 0.0537
20.0235 0.2660
0.1598 20.0804
0.0950 0.0639
Other food 0.0686
20.0742 0.0630
20.0010 20.0563
0.9752 20.0024
0.1056 0.1113
0.1813 Clothing and footwear
20.2628 20.3034
0.3220 20.0327
0.2768 0.5367
20.2400 0.3596
0.0663 0.4864
Fuel and light 0.2081
20.0267 20.0173
20.1003 20.0638
0.9848 0.0349
0.0192 20.0041
0.1398 Services and miscellaneous
0.0802 20.3126
0.1699 20.2051
0.2677 1.5211
20.1984 0.2376
20.0266 0.6454
h
kj
and m
kj
are as per equations given in Appendix.
270
N. S.
S. Narayana
and B.
P. Vani
Table 6: Consumption Effects from Alternative Earning Schemes
WG GC
LP OR
DS E
CRL OFD
CLF FUL
SNM
NCW 1970–71 Reference:
941.7 116.6
99.7 132.8
110.1 1400.8
588.3 532.8
71.9 109.9
97.8 Change in
all incomes 1008.9
124.9 106.8
142.3 117.9
1500.8 612.1
518.9 78.1
119.4 109.3
only WG 1041.7
116.6 99.7
132.8 110.1
1500.8 618.1
580.0 74.2
116.7 111.8
only GC 941.7
216.6 99.7
132.8 110.1
1500.8 602.7
575.8 91.3
148.2 82.9
only LP 941.7
116.6 199.7
132.8 110.1
1500.8 569.3
645.1 71.2
103.9 111.2
only OR 941.7
116.6 99.7
232.8 110.1
1500.8 614.5
553.6 95.7
125.2 111.9
only DS 941.7
116.6 99.7
132.8 210.1
1500.8 606.4
581.9 82.2
119.4 110.8
CNL 1974–75 Reference:
1896.5 150.4
89.1 234.8
497.1 2867.9
1383.8 911.9
120.0 201.6
250.7 Change in
all incomes 1962.8
155.6 92.2
243.0 514.5
2967.9 1408.1
955.9 124.9
209.8 269.2
only WG 1996.5
150.4 89.1
234.8 497.1
2967.9 1403.4
959.2 123.4
211.9 270.2
only GC 1896.5
250.4 89.1
234.8 497.1
2967.9 1527.1
912.0 102.3
206.3 220.3
only LP 1896.5
150.4 189.1
234.8 497.1
2967.9 1263.5
1018.9 165.4
205.9 314.1
only OR 1896.5
150.4 89.1
334.8 497.1
2967.9 1438.9
955.6 123.4
201.6 248.5
only DS 1896.6
150.4 89.1
234.8 597.1
2967.9 1401.8
945.9 131.2
207.3 281.8
Reference: At the sample averages of WG, GC, LP, OR and DS.
EARNINGS AND CONSUMPTION BY INDIAN LABORERS 271
poor. Some schemes are direct employment oriented; some pro- vide cattle and buffaloes; some subsidize food consumption, farm-
development, land-development etc., and so on. A number of studies earlier analyzed different social welfare programmes. See
Taylor 1980 for a survey on the experiences gained by different countries in this context and Sah and Srinivasan 1988 for an
assessment of the impact on different social groups of a food redistribution program. Here we take up the issue such as: as far
as ultimate impact on food and nonfood consumption pattern is concerned, are all such programmes same? To anayse such an
issue, the estimated equations could be used. Suppose an incre- ment of Rs 100- per household is to be provided in annual total
expenditure over its current level of these poor households. Sup- pose this additional sum is provided through alternative welfare
schemes: either as wages WG, or garden and orchard produce plus cultivation if any GC, or livestock and poultry farming LP,
etc. The resulting commodity consumptions under alternative schemes are shown in Table 6. Maximum increase over the refer-
ence average level, for example, in cereals consumption was brought by additional wage income WG in the case of NCW
and by additional cultivation income in the case of CNL. For both NCW and CNL, additional income from livestock and poultry
brings maximum increase in other food consumption and even reduces the cereal consumption. Coming to non food commodities
other than fuel and light, additional incomes in other household enterprises OR for the NCW, and in livestock and poultry opera-
tions LP for the CNL provide for maximum increase in consump- tion of these commodities. The results suggest that employment
oriented and land related welfare programmes have an edge over the other programmes in improving the staple food, cereals, intake
by the poor.
6. CONCLUSIONS
