Don't Misrepresent World Bank Estimates to Show Low Inequality

An urge to show progress must neither use faulty comparisons nor gloss over the realities of India

- HIMANSHU

After declaring that India has almost eliminated extreme poverty, the government's Press Information Bureau (PIB) has picked up another set of estimates from the World Bank. This PIB release last week used the Bank's estimates of Gini coefficient, a measure of inequality, to declare that India is now the fourth most equal country in the world. These estimates are not new. They were part of the Bank's release a month ago along with its poverty estimates.

The PIB is right on the rank of India among all 177 countries for which Gini data is available on the Bank's Poverty and Inequality Platform (PIP). But what the PIB did not mention was that the Bank itself cautions against comparing Gini numbers from consumption surveys with those from income surveys.

The PIP's Gini of 104 countries is based on consumption surveys, but for the other 73, it is based on income surveys. Anyone looking at cross-country (or even within-country) comparisons of inequality should know that the two are not comparable.