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Economic Inequality in the ‘Democratic’ Nepal: Dimensions and Implications
Unformatted Document Text:  12 business ownership, however, appears to be a leading source of wealth inequality, especially when looking at the rampant increase in the associated Gini index. An almost 0.16 point increase in the already very large Gini index entry uncovers an extreme form of economic inequality in business activities, suggesting that the sudden growth in mega businesses is effectively dwarfing the growth in small businesses that may be the backbone of this early-industrializing economy. The inequality of the ownership of other types of fixed and liquid assets and especially the real estate and houses appears to be declining over time possibly for the reason that the demand for these types of properties has not increased nationwide owing largely to the enduring political turmoil. IV Horizontal Inequality Across Groups I investigate inequality by looking at the differences in the access to resources across different caste/ethnic and spatial groups. 14 Table 3 reports estimates of household expenditure, income, and wealth and their appropriate sources for major caste/ethnic groups. Compared to the national average, for example, the high caste Hindus (HCH’s) including the Brahmins and Chhetries from both Hills and Terai had considerably larger household expenditures, considerably smaller unadjusted household income, and slightly larger adjusted household income and household wealth. In 1996, they appeared to be better poised on average than the rest of the population even though their reported incomes tended to be considerably smaller. Their relative positions also significantly improved by 2004. While all of their averages significantly increased, more significant was the increase in adjusted income estimated at over 60 percent. This resulted from the increase in income and wealth across all sources, even though income from agriculture declined somewhat, a typical scenario nationwide.

Authors: Wagle, Udaya.
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12
business ownership, however, appears to be a leading source of wealth inequality, especially
when looking at the rampant increase in the associated Gini index. An almost 0.16 point increase
in the already very large Gini index entry uncovers an extreme form of economic inequality in
business activities, suggesting that the sudden growth in mega businesses is effectively dwarfing
the growth in small businesses that may be the backbone of this early-industrializing economy.
The inequality of the ownership of other types of fixed and liquid assets and especially the real
estate and houses appears to be declining over time possibly for the reason that the demand for
these types of properties has not increased nationwide owing largely to the enduring political
turmoil.
IV Horizontal Inequality Across Groups
I investigate inequality by looking at the differences in the access to resources across different
caste/ethnic and spatial groups.
14
Table 3 reports estimates of household expenditure, income,
and wealth and their appropriate sources for major caste/ethnic groups. Compared to the national
average, for example, the high caste Hindus (HCH’s) including the Brahmins and Chhetries from
both Hills and Terai had considerably larger household expenditures, considerably smaller
unadjusted household income, and slightly larger adjusted household income and household
wealth. In 1996, they appeared to be better poised on average than the rest of the population even
though their reported incomes tended to be considerably smaller. Their relative positions also
significantly improved by 2004. While all of their averages significantly increased, more
significant was the increase in adjusted income estimated at over 60 percent. This resulted from
the increase in income and wealth across all sources, even though income from agriculture
declined somewhat, a typical scenario nationwide.


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