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IHDS is one of the first Indian surveys to collect detailed income data. Most surveys depend on consumption expenditures or household assets to measure a household’s economic level. IHDS collected those data also (see consumption and household assets, but went to great lengths to measure household income as well. Over 50 different income sources were queried. The public use file collects those sources into eight major income types (incfarm .. incother) plus a total income variable (income). All are household-level variables, but all are included in both the household and individual data files.
|Variable||N obs||Unique Values||Unwtd. Mean||Min||Max||Label|
|income||41554||21111||54428.3||-107350||6520261||HH5-15 3-8 Total income|
|incfarm||41554||17098||10265.92||-107350||4817152||HH6-10 4-6 Family farm inc|
|incagwage||41554||1273||3242.46||0||155000||HH11 6.8+ hh ag wages|
|incnonag||41554||1372||5552.11||0||292000||HH11 6.8+ hh nonag wages|
|incsalary||41554||2394||20616.48||0||960000||HH11 6.8+ hh salaries|
|incbus||41554||844||10127.89||0||6190000||HH11-14 7. Net business inc|
|incremit||41554||188||1436.6||0||610000||HH5 3.13 Sum hh remittance|
|incgovt||41554||395||221.42||0||200000||HH15 8.7-13 govt benefits|
|incother||41554||564||2965.43||0||500000||HH15 8.1+ property, pensions|
The most difficult income source to estimate is farm income (incfarm). Over half of IHDS households had some farm income, so this is an important component of the total income estimate. IHDS asked about crop production and prices, use of crop residues, animal ownership and home-produced animal and crop products, expenses for a variety of farm inputs, and agricultural rents paid and received. IHDS staff continue to work on refining these data to produce the best income estimates possible.
Negative farm income is reported by about 9 percent of the sample. Crop failures and high expenses are a frequent source of debate in India so this estimate seems reasonable. Negative farm incomes result in negative total income estimates for about 1 percent of the households. Other analyses by IHDS staff suggest that these households do not appear as poor on other economic dimensions as households with low but positive incomes. Data users may want to consider restricting income analyses to the sample of households with positive income (or income >= Rs. 1000) and adding separate analyses for the negative or very low income households.
Wage and salary incomes were summed across all jobs of all individuals in the household. Annual totals were estimated using the report of days worked for workers paid daily wages or monthly salaries. Meals, housing benefits, and bonuses are included in these totals. The public use file divides wage and salary incomes into three subtypes: incsalary salary income is defined as income earned monthly or annually (rather than daily); incagwage agricultural wages are the total daily wages of workers with agricultural occupations; and incnonag nonagricultural wages are all other daily wages.
Remittances (incremit) were totaled from item 3.13 of the non-resident schedule (page 5 of the household questionnaire).
Nonfarm business income (incbus) was sometimes reported only as net income without specifying gross income and expenses. Therefore, net business income does not always equal gross business income minus expenses.
IHDS also collected data on several sources of cash and noncash support not included in the total income estimate because these sources are not properly defined as income. For example, about 2% of households sold some land in the previous year (in4a and in4b); 1% received insurance payments (in6); and about nine percent had received some housing support such as latrines, stoves, or housing materials (in14 and in15). These data are available in the IHDS files but are not included as income. The following table details some of the income sources used to calculate total income:
|Variable||Description||Mean all hh||% nonzero||Max|
|ws8annhh||Wage & salary||25,949||71%||960,000|
|- ws8pay||regular pay||25,485||71%||960,000|
|- nf3hh||gross receipts||23,469||19%||19,000,000|
|- nf4hh||expenses: labour||1,398||5%||900,000|
|- nf5hh||expenses: other||13,180||15%||16,000,000|
|incfarm||Net Agricultural Income||9,331||53%||4,817,152|
|- fm15*fm18||Gross crop income||10,188||38%||4,913,500|
|- fm19Rs||Total value of crop residue||770||34%||200,000|
|-- fm19aRs||Residue sold||214||9%||64,000|
|-- fm19bRs||Residue kept for own use||556||30%||200,000|
|- fmexpense||Total crop expenses||3,578||38%||324,502|
|-- fm20b||Hired farm labour||719||23%||90,000|
|-- fm20cRs||Meals to hired labour||33||8%||16,000|
|-- fm25||Hired equipt/ animals||467||26%||87,120|
|-- fm26i||Interest on loans||52||3%||60,000|
|-- fm27||Miscellaneous expenses||389||14%||98,000|
|- animalRs||Animal gross income||3,099||39%||1,117,774|
|-- an2a+an2b||marketed: milk, eggs, animals||1,279||16%||1,000,00|
|-- co8,11,12,13||home grown milk, eggs, meat||1,336||21%||260,160|
|-- half: co8,11,12,13||partially home grown||45||2%||75,600|
|-- an1a,b,c||estimate dung value||323||35%||72,932|
|-- an1e||estimate wool value||8||1%||14,753|
|-- animalRsx1.03||est. reproduction of animals||108||39%||38,842|
|- anexpense||Expenses for animals||1,532||40%||600,000|
|-- an4a||home grown grain||269||21%||55,000|
|-- an4b||home grown residue||616||30%||99,000|
|-- an4c||purchased grain & residue||647||28%||600,000|
|- incagprop||Agricultural property income||745||7%||99,000|
|-- fm6c||Rs. income from land rented out||294||2%||90,000|
|-- fm6e||Rs. income from sharecropped land rented out||258||3%||85,000|
|-- fm32i||Equipment rented out, income||192||2%||99,000|
|-- fmrentexp||Agricultural rents paid out||361||6%||284,000|
|--- fm8c||Rs paid for land rented in||105||2%||90,000|
|--- fm16Rshh||Landlord's share of sharecropped land rented in||257||4%||284,000|
|incother||Property & Other Income||2,511||10%||500,000|
|- in1||renting property||386||3%||500,000|
|- in2||interest, dividends||237||2%||500,000|
|- in3a||pensions: government||1,703||5%||400,000|
|- in3b||pensions: private||99||0%||200,000|
|- in16||other income||86||1%||100,000|
|- in5||scholarships and gifts||114||7%||200,000|
|- in7c||National Old Age pensions||45||2%||8,400|
|- in8c||Widows' Pension Scheme||23||1%||12,000|
|- in9c||National Maternity Scheme||2||0%||4,950|
|- in10c||National Disability Pension||4||0%||6,200|
|- in12c||Other government transfers||7||1%||10,000|
|- in13c||NGO or other assistance||2||0%||7,000|
** A note on UNEARNED:
UNEARNED is an individual level variable, not a household variable.
UNEARNED = Total hh income – individual’s annual earnings from wage and salary - earnings from business - earnings from farm - earnings from animals
That is, each individual's own wage and salary, farm, nonfarm business, and animal income are all treated as earned income for each individual in the household. Estimates for earnings from farm, business, and animals are based on the %of household time that each individual has spent on that activity.
Everything else (including earnings from other household members!) is unearned for that individual.
UNEARNED is the conventional measure of the disincentive for labor force participation and so especially important for analyses of changing women's labor force participation.
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