A STUDY ON INCOME AND EXPENDITURE PATTERN OF

DHURKOT RURAL-MUNICIPALITY, GULMI

A Thesis Submitted to the

Central Department of Economics
Tribhuvan University, Kirtipur, Kathmandu, Nepal
in Partial Fulfillment of the Requirements for the Degree of
MASTERS OF ARTS
in
ECONOMICS

By

Saraswati Pokharel
Roll No. : 36/072
Tribhuvan University
Central Departments of Economics
Kirtipur, Kathmandu
March 2021
 LETTER TO RECOMMENDATION

The thesis entitled "A STUDY ON INCOME AND EXPENDITURE PATTERN

OF DHURKOT RURAL-MUNICIPALITY, GULMI" has prepared by Saraswati
Pokharel under my supervision and guidance. I hereby recommend this thesis for
examination by the thesis committee as a partial fulfillment of the requirements for
the Degree of Master of Arts in Economics.

……………………………..
Mr. Baburam Karki
Thesis Supervisor

i
 APPROVAL LETTER

The thesis entitled "A STUDY ON INCOME AND EXPENDITURE PATTERN

OF DHURKOT RURAL-MUNICIPALITY, GULMI" submitted by Saraswati
Pokharel to the Central Department of Economics, Faculty of Humanities and Social
Sciences, Tribhuvan University, in partial fulfillment of the requirement for the
degree in Master of Arts in Economics, has been found satisfactory in scope and
quality. Therefore, we accept this thesis as a part of said degree.

Evaluation Committee:

……………..……….……
Dr. Yogesh Ranjit
(Acting Head of the Department)

……………..……….……
Ms. Anjeela Pradhan (Gorkhali)
(External Examiner)

……………..……….……
Mr. Baburam Karki
(Thesis Supervisor)

ii
 ACKNOWLEDGEMENTS

I am very indebted to people of Dhurkot rural-municipality, who co-

operatively shared their experiences and provided their valuable time during the
field work. I would like to thank my thesis supervisor Mr. BABURAM
KARKI, Lecturer, CEDECON, TU. for his continuous supervision and
constructive comments for completing this work. Similarly I would also like to
thank the head of the central department of economics and external examiner
for valuable suggestion to complete this study.

Similarly I would like to remember my friends who have inspired to proceed

my work forward finally.

Saraswati Pokharel

iii
 TABLE OF CONTENTS

Page No.

LETTER TO RECOMMENDATION i

APPROVAL LETTER ii

ACKNOWLEDGEMENTS iii

TABLE OF CONTENTS iv

LIST OF TABLE vi

LIST OF FIGURE vii

ABBREVIATIONS viii

CHAPTER-I: INTRODUCTION 1

1.1 Background of the Study 1

1.2 Statement of the Problem 2

1.3 Objective of the Study 4

1.4 Significance of the Study 4

1.5 Limitations of the Study 5

1.6 Oraganization of the Study 5

CHAPTER-II: REVIEW OF LITERATURE 6

2.1 Theoretical Concepts 6

2.2 Empirical Context 8

2.3 Nepalese Context 10

CHAPTER-III: RESEARCH METHODOLOGY 13

3.1 Introduction of the Study Area 13

3.2 Research Design 13

3.3 Source of Data 13

iv
 3.4 Method of Sample Selection 14

3.5 Method of Data Collection 14

3.6 Data Processing 14

3.7 Methods and Tools of Data Analysis 14

CHAPTER-IV: PRESENTATION AND ANALYSIS OF INCOME DATA 18

4.1 Level and Sources of Household Income 18

4.1.1 Socio Economic Background of the Study Area 18

4.1.2 Land Holding 24

4.1.3 Sources of Household Income 27

4.1.4 Level of Household Income 28

4.1.5 Adequacy of Income 30

4.2 Expenditure Pattern 30

4.2.1 Pattern of Household Expenditure by HHs Size 32

4.3 Measure the level of Income Inequality 33

4.3.1 Income Distribution of Study Area 33

4.3.2 Graphical Presentation of the Income Distribution 35

4.3.3 Measurement of Income Inequality Level 35

4.3.4 Alternative Indicators of Measuring the Level of Income Inequality 37

CHAPTER-V: SUMMARY, CONCLUSION AND RECOMMENDATION 38

5.1 Summary of the Major Findings 38

5.2 Conclusion 39

5.3 Recommendation 40

REFERENCE

APPENDICES

v
 LIST OF TABLE

Table 4.1 Caste Ethnic Composition of Study Area 19

Table 4.2 Distribution of Economically Active Population by Occupational Structure

19

Table 4.3 The People Are Employed in Foreign Countries 20

Table 4.4 Population Distribution by Age Group 21

Table 4.5 Educational Status of the Sample Households 22

Table 4.6 Caste/Ethnic-wise Household and Population 23

Table 4.7 Occupational Status of the People of 14 Years and Above 24

Table 4.8 Distribution of Size of Landholding among the Sampled Household 25

Table 4.9 Size of Distribution of Land Holding by Caste/Ethnic Groups 26

Table 4.10 Level and Sources of Household Income 27

Table 4.11 Level and Sources of Income 28

Table 4.12 Level of income by HHs size 29

Table 4.13 Adequacy of Income 30

Table 4.14 Pattern of Households Expenditure 31

Table 4.15 Patterns of Household Expenditure by Family Size 32

Table 4.16 Distribution of Income by Decile 34

Table 4.17 Value of Gini-Coefficient 36

Table 4.18 Alternative Indicators of Measuring the Level of Income Inequality 37

vi
 LIST OF FIGURE

Page No.

Figure 1 Lorenz Curve 35

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 ABBREVIATIONS

ADB : Asian Development Bank

CBS : Central Bureau of Statistics

GDP : Gross Domestic Products

HDR : Human Development Reports

HHs : No. of Households

IFAD : International Fund for Agriculture Development

LDC : Less Developed Countries

NLSS : Nepal Living Standard Survey

NRB : Nepal Rastrya Bank

NRs : Nepalese Rupees

UK : United Kingdom

UNDP : United National Development Program

USA : United States of America

DPG : District Profile of Gulmi

NPC : National planning Commission

viii
 CHAPTER-I
INTRODUCTION

1.1 Background of the Study

After the Second World War, many economists have put the concept of economic
growth for the development of underdeveloped countries. This concept has applied in
the field of economic development and focus on the quantitative rather than
qualitative aspect of development. Economic growth concept has focused on the
increases in per capita income, national income, production and investment.
Developed countries have helped capital to underdeveloped countries to achieve
higher economic growth rate and narrow down poverty and unemployment level. But
some of developing countries have gained bad result such as poverty, unemployment
and gap between rich and poor have increased and some of have achieved higher
economic growth rate but with a bad distribution of income, which has not good result
for the development. Development is that where a country gains sustainable growth
rate by balance income distribution. In present day most of the economist purported
the concept of economic growth with distribution and also further put the other
concept of development such as basic need approach, human development approach,
balanced development approach and people participation approach. In unequal
income distribution is the burning problem of the world. Unequal distribution of
income is the obstacle for the development of a country. It brings resources gaps
between rich and poor. Therefore the balanced development concept and people
participation approach are the better income distribution (Bhattarai, 1983).

Due to inadequate income, the poor families are unable to meet even their basic
requirements such as food, clothing, housing, education and health while rich families
who are relatively smaller number spend luxurious life.

Nepal is the one of the least developed country of the world. Most of the people of
this country suffering from poverty, unemployment and inequality. This country has
not get rid of from vicious circle of poverty such as low level of production, low level
of income, low level of saving, low level of investment and again low level of
production. Nepal is facing these types of problem and applying different kinds of

1
developmental strategies to reduce poverty and inequality. Nepal has been achieved
capital technology and plans by developed countries and international organization for
the development. Nepal has been able to reduce a little bit poverty but increases the
gap between rich and poor and also rural and urban sectors, this means increases
income inequality. According to the UNDP report 2019, annual per-capita income in
Nepal has $ 1071. The rural economy of Nepal is excessively dependent in
agriculture. Rural people have gained low level of income from agriculture. They are
used traditional agricultural method for the different kinds of production. They are
suffering from seasonal unemployment and poverty. But urban areas have seen many
kinds of earning resources, they earn more than rural people (UNDP, 2019).

Similarly Income inequality is stated the unequal distribution of income or resources

clearly. It shows the unequal income such as the small no. of groups of people have
gained large amount of income and the large no. of groups of the people have gained
small portion of income of the nation.

Income inequality has seen in the society because of unfair distribution of the
resources. By this courses, in this way society have divided into two parts such as rich
and poor class. This situation brings large gap between rich and poor and also conflict
in the society.

In the context of Nepal, gap between poor and rich now a day is rising income share
held by highest 10% people have 26.52% income and lowest 10% people have 3.63%
income gained (World Bank, 2018). Rich becomes richer and poor poorer in present
situation because of poor income distribution. The middle class families are
increasing rapidly in Nepal. Foreign employment has become the temporary sources
of income of the Nepalese people in the present situation. Youth has played big role in
raising the Gross National Income. Employment opportunities are created through the
availability of skill which has helped improve the income level of target group and
that contributed significantly towards reducing country's poverty. (MOF, 2018).

1.2 Statement of the Problem

Nepal is one of the least developed country of the world. Poverty, unemployment and
inequality are the serious problems of this country. According to the Prof. Meier and

2
Rauch (2000), “Poverty is not the same as inequality. The distinction needs to be
stressed, where as poverty is concerned with the absolute standard of living of a part
of society the poor-inequality refers to relative living standards across the whole
society. At the maximum inequality one person has everything and clearly, poverty is
high. But the minimum inequality (where all are equal) is possible with zero poverty
(where all are poor).”

MOF (2018) shows that 18.7 percent people lie in the below the poverty live. Survey
has showed that urban poverty and rural poverty has lied in 15.46 and 27.43 percent
respectively. Similarly Gini Coefficeint of rural and urban area have 0.311 and 0.353
and Human development index of Kathmandu and Mugu have 0.632 and 0.364
respectively (NLSS, 2017). Above data shows that the income inequality is dominated
in both rural and urban areas. Generally the household income level in the urban areas
has been increasing rapidly ever the past few decades. This is due to gradual
economic growth experienced by the country. However, the wealth which is one of
the attributing factors for household income has been concentrated in few rich
families. It further widened the gap in the income level of rich and poor households.
This is becoming serious in the urban areas in recent time. The poor families spend a
higher proportion of their household income for food i.e. MPC is high relative to rich
families. This leaves a smaller proportion of income for other basic needs such as
housing clothing, education and health. This makes these families vulnerable to
disease, malnutrition, illiteracy, high infant mortality in educate shelter, low
purchasing power and high migration tendency (Pokhrel, 2002).

Most of the studies agree that there is vast income inequality in Nepal. It must reduce
income inequality to achieve economic development. It is not easy to advise simple
poverty alleviation strategy for Nepal. The problem is to develop a model which could
be used in the future for poverty alleviation. But economic development is constrained
by income inequality in the society.

The unequal distribution of income is becoming one of the most important features of
Nepalese society and it is resulting in economic unequal by as well as social
inequality. This inequality also brings, political instability, increasing crime,
dissatisfaction among the people and social injustice to the citizens. Therefore
inequality has become a remarkable obstacle to Nepalese society and equally difficult

3
task for policy makers. The main aim of policy makers or government is to attain
maximum welfare for maximum number of people. Society‟s welfare depends not
only on income or consumption but also in its distribution.

Similarly HDI of Gulmi 0.413, poverty level is 32.19 and annual per capita income is
$421 (District Profile of Gulmi, 2075). Above data shows that the condition of the
people of Gulmi in this district have the serious problems of poverty and income
inequality. So that researcher chooses income and expenditure topics for research this
is the researchable problem in the district some few people have a lot of property
power and prestige and a lot of people have few property income or resources.

This study tries to analysis income and expenditure and measure the degree of income
inequality in Dhurkot rural-municipality of Gulmi district. It is hoped that the result of
this study will provide a suggestion insight for the policy and decision makers. This
study seeks to find necessary solution for such problem. It is hope that the result of
this study will help for the policy maker and planners to tackle the problem of unequal
distribution.

1.3 Objective of the Study

The general objective of the research is to study the income inequality of Dhurkot
rural-municipality. However, the specific objectives are:

(i) To analyze the level and sources of household income in the study area.
(ii) To examine the patterns of household expenditure in the study area.
(iii) To measure the level of income inequality in the study area.

1.4 Significance of the Study

This study cannot represent the whole structure of economic distribution in overall
country. But some information will provide to policy maker and planner of the
country about the distribution of income. Income and expenditure is a macro variable
but this study is based on micro level. This study helps for the planner to know

4
income level and expenditure pattern of the people‟s in the study area and also help to
find out the inequality of the income of the people. This study helps for the NGO and
INGO to conduct poverty reduction and employment creation program in the study
area.

1.5 Limitations of the Study

1. This study is mainly concerned with Dhurkot rural-municipality in Gulmi district.

So, this study may not represent the level of the problem for the country as a
whole.
2. In this study the value of land is not included as income sources.
3. Simple tools have been employed.

1.6 Oraganization of the Study

Form the administrative point of view, Nepal is divided into seven states, 77 districts,
6 metropolitan cities, 11 sub- metropolitan cities, 276 municipalities 460 rural-
municipalities and 6743 wards. Gulmi is the district, which has consists 10 rural-
municipalities and 2 municipalities. Dhurkot rural-municipality is the area of my
research rural- municipality. Subject matter of my study is „income inequality‟ There
was not rural-municipality in this district before 2072 B.S. the government of Nepal
was declared Dhurkot rural-municipality in 2072 BS, formed by seven wards such as
Jaisithok, Bastu, Nayagaun,papaldhara, Wagle, Dhurkot Rajasthal and Hadhade.
Researcher study area of this rural-municipality, ward no. 1 to 7. So that I have used
current data for reliable study from Dhurkot rural-municipality profile.

5
 CHAPTER-II
REVIEW OF LITERATURE

In this chapter an attempt is made to review some of the existing literature in the size
of distribution of income. Many economists have devoted their time on the topic
“income and expenditure”. Among them we have got various empirical studies in
different periods covering many countries. International institutions especially the
World Bank and International Labour Organization have supported several of the
studies. There are also available independent professional efforts by universities and
research organizations on the very topic “Income and expenditure”. Few studies have
been accomplished by individual and organizations in the context of Nepal. Some
relevant literatures are reviewed below.

2.1 Theoretical Concepts

A situation which people are not equal because some groups have more opportunities,
power, money etc. than others (Collins English Dictionary,2009). It is to clear from
this quotations "all animals are equal but some animals are more equal than other"
(Gearge Orwell, animal farm). Generally we can say that in equality means the lack of
equality or disparity between rich and poor people. Some people have gained more
income from the more resources and some have less income from few resources. That
conditions is good, where the income and expenditure of the people is balance.

Generally we can see in the society the causes of inequality are Social equality,
Economic equality, Regional equality, racial equality, and Sexual inequalities.

According to the Ferdinand Mount, five types of inequalities are in society. There are
Political inequality, Differing life outcomes, Inequality of opportunity, Treatment and
responsibility and Shared equality of membership in the areas of nations faith and
family.

Income inequality is the unequal distribution of household or individual income

across various participants in an economy. Income inequality is often presented as the
percentage of income to a percentage of population e.g. a statistics may indicate that

6
70% of a country's income is controlled by 20% of that countries resident. It is
generally consider 'unfair' if rich have a disproportionally larger portion of a country's
income compared to their population.

Todaro(1997) explained the poverty and inequality in his book “Economic

development” Multi-elimination process involving changes in structure attitudes and
institutions as well as the acceleration of economic growth, the reduction of inequality
and eradication of absolute poverty.

John Rawals in his theory justices concerned with more than just income distribution.
He quotes "All social values, liberty and opportunity income and wealth and baser of
self respect are to be distributed equally, unless an unequal distribution of any or all of
these values is to everyone‟s advantages.” His focus is on a typical individual in the
bottom group. Income inequality is desirable goal expect in special circumstance. His
analysis starts in an extremely promising way. He concludes that a consensus will
develop in favor of an equal distribution that leaves everyone better off. This is what
Rawals calls the difference principle. His approach generally leads to inequality from
choosing to be better off. People in an original position would choose option of
equality and after he/she likes to be better off. Those who have higher income
welcome the condition of inequality and those who have lower income seem in favor
of equality. He suggested that to have equality in income, people must be rewarded
from their original situation and place in an original position (Rawals, 1971).

A.K Sen the winner of novel prize in economics in 1998, has explained about the
welfare, utilitarianism and equality, means of inequality etc. in his publication “on
income inequality.” He has further explained that the nature of inequality has been of
quasi- ordering. The objective and normative feature of the lecture are focused on the
problem of the measurement of inequality of income distribution in aggregative terms.
He tried to go into some policy issue especially in the context of socialist economy.
He has divided the measurement of in equality into two categories. Objective sense
usually employs some statistical measures of relative variation of income and
normative notion of social welfare so that the higher degree of inequality corresponds
to lower level of social welfare for given total income. He has stressed that inequality
measures do have positive elements which are difficult to disassociate from the
welfare picture, he has mentioned the measure of inequality as range, standard

7
deviation of logarithms. Theil‟s Entropy measure, Dalton‟s measure, Atkinson‟s
measure etc. he has noted that the relationship between social welfare and inequality
measures is not that of one to one correspondences (Sen, 1997).

Gunnar Myrdal has explained some general important causes of income inequality in
underdeveloped countries. According to him the main causes of the income inequality
are malnutrition, lack of elementary health and educational facilities, extremely bad
housing condition and sanitation, social and economic unequal occasion of various
facilities, high family size, higher level of consumption and low saving etc. Finally he
concludes that inequality and the trend towards rising inequality stands as a complex
of inhibitions obstacles to development and it seems to have been increasing in recent
time. He further explains that the social inequality stands as a main cause of
economics inequality and at the same time economic inequality supports social
inequality (Mydral, 1970).

Kuznet(1995) conduct a study “Economic growth and income inequality” in a

developed and under developed countries. The main idea of this study is that income
distribution in under developed countries is somewhat more unequal than that of
developed countries. The study was based on cross sectional data of USA and U.K.
and Germany and generalized to all countries. Kuznet‟s hypothesis is that inequality
at first increases and then decreases with the level of development, Kuznet‟s
conclusion can be as follows:

1. In both groups of countries inequality is less in the agriculture sector than in

the non-agriculture sectors.
2. He attributed that the existence of greater in equality of income distribution in
developing countries was caused by greater concentration in the ownership of
income yielding assets.
3. Capital is not only concentrated in fewer hands but its total size relative to
population is small.

2.2 Empirical Context

Oxfarm international released the report to the world economic forum that the richest
1% owns 48% of the global wealth in 2017 Oxfarm reported that the 85 weal theist

8
individuals in the world have a combined wealth equal to that of bottom 50% of the
world population or about 3.5 billion people. In January 2018, Oxfarm reported that
the wealthiest 1% will own more than half of the global wealth by 2019.

Paul Wonnacott and Ronald Wonncatt explained the cause of inequality in America
their book “Economics” in 1979. Their main findings is that the poorest 20 percent of
the population receives only 0.3 percent of nation‟s income pie, while the richest 20
percent gets over half of that pie, they had mentioned the cause of income inequality
and suggested to make equal income distribution. Their view about the causes of
income inequality is that there exists large difference in the incomes of individual
American. Some have high incomes because of their human capital, wealth, native,
talent market power of just plain luck and others have low income because they enjoy
none of these advantages or for other reasons. Their suggestion to solve inequality is
related to the most effected government expenditure, social insurance and other kinds
of government expenditure.

Human development report (1999) published by United Nations development

program (UNDP) shows a skewed distribution of world gross domestic product
(GDP), according to the report, the richest 20 percent receive 86 percent share of
world GDP. The middle so percent enjoys only 13 percent the World GDP white the
poorest 20 percent receives more one percent of this. According to this report income
gap between the fifth of the world‟s people living in the richest countries and fifth in
the poorest.

The world development report,(2001) published by World Bank, “The world has deep
poverty amid plenty of the world‟s 6 billion people, 2.8 billion almost half live on less
than $ 2 a day, and 1.2 billion a fifth lives on less than $ 1 a day with 44 percent
living on Asia. This report further added that the average income in the richest 20
countries is 37 times the average in the poorest 20, a gap that has doubled in the past
40 years.

According to the human development index 2019, which has been published by
UNDP, Norway lies in the very high position 1, of HDI and its value is 0.955.
Similarly Uruguay lies in the high position 50, of HDI and its value is 0.790 and
Maldives lies in the medium position 103, of HDI and its value is 0.698. Similarly

9
Nepal lies in the 142th position of HDI and its value is 0.602. The Human
Development Index, which is largely, measured the poverty on the basis of life
expectancy education and income.

Gini coefficient shows the value of unequal distribution of income and the condition
of income inequality of the society. According to the report ADB report given the
clear indicators about the Gini coefficient, poverty level and HDI of the SAARC
countries.

In the Afghanistan, 36 percent people are living below the poverty line. HDI of this
country is 0.398. In the Bangladesh 24.3percent people are living below the poverty
line. Gini coefficient and human development index of this country are 0.310 and
0.500 respectively. In the India 6.7 percent people are living below the poverty line
and HDI of this country is 0.645. In the Maldives 8 percent people are living below
the poverty line. GC and HDI of this country are 0.370 and 0.740 respectively. In the
Nepal 18.7 percent people are living below the poverty line. GC and HDI of this
country are 0.395 and 0.602 respectively. In the Pakistan GC and HDI of this country
are 0.362 and 0.602 respectively. There are 23.3 percent people are living below the
poverty line. In the Sri-Lanka 4.1 percent people are living below the poverty line. GC
and HDI of this country are 0.514 and 0.872 respectively. In the Bhutan 8.2 percent
people are living below the poverty line. GC and HDI of the Bhutan are 0.374 and
0.522 respectively. (ADB, 2018).

2.3 Nepalese Context

According to the development report of Nepal research by World Bank and Nepal.

Income share held by highest 20% is 41.46%, Income share held by lowest 20% is
8.27%, Income share held by second 20% is 12.16%, Income share held by third 20%
is 16.22%, Income share held by fourth 20% is 21.89% (WB and Nepal, 2018).

This data shows the inequality condition of Nepal, where few rich people have highest
share of income and more poor people have lowest share of income.

According to the MOF(2018), Despire drop in poverty level to 23.8 percent from 42%
in a span of 17 years between FY 1999/2001 and FY 2016/117 have big disparity

10
among rural and urban, geographical and between various groups exist. Both urban
and rural poverty has declined from 21.56 to 15.46 and 43.27 to 27.43 percent
respectively. But gap between the poor and the rich has widened in the country due to
general rise in inequality. Gini-coefficient a measure indicating the existing disparity
in the country stood at 0.328 with respect to the consumption expenditure. Such
indicates in the urban areas stood at 0.353 and 0.311 in rural areas. The level of
disparity between geographical reason and ethnic groups is much wider because of the
rise in internal conflict, low agriculture wage rate, displaced people and limited
opportunities. The remittance has played the big role in raising the Gross National
income and help to reduce poverty level. But gap between rich and poor is
widening further. Reducing existing inequality gap between poor and rich by
providing continuity to the poverty reduction initiatives is a top challenges (MOF
2018). Nepal living standard survey report 2014, published by CBS Nepal shows the
sources and distribution of income in the country. The objectives of the survey was to
assess the living standard and poverty situation of the Nepalese society and another
aim was to analyze and study interrelationship of various socio and economic
variables for vary use in formulation poverty and inequality reduction plan and
program. According to the Nepal living standard survey report (NLSSR-III), 18.7
percent of Nepalese are living below the poverty line. The report said, 5.7 percent
decline in absolute poverty in between 2007-2008 and 2013-2014. According to this
survey, uses 2,200 calorie consumption by a person per day and access to essential
non food items as the index to measure poverty in Nepal. Based on current market
prices a person needs an income of at least as 14430 a year to manage food equivalent
to 2,200 calorie per day and other essential non food items. The report shows the
person who has earned less than 14,430 per year is below the poverty line. Other
interesting facts are that poverty level in the urban hill is lower than that in
Kathmandu. It is said that household led by agricultural wage workers are the poorest,
while those headed by professional wage workers art the least poor. According to the
survey only 8.72 percent are below the poverty line in the hilly cities while the
poverty level in the capital is 11.47 percent.

In terms of development regions, eastern has lowest poverty level such as 21.44%
while the far western has the highest level of poverty such as 46 percent are below the
poverty line. Similarly hill Dalits and Terai Dalits have the highest poverty level

11
while hill Brahmins and Newars have the least. According to the economists, causes
of decline the poverty level is the government huge investment in social sector and
remittance such as 55.8 percent of the household receive remittance with each
household receiving Rs.80,436 a year, remittance will not be sustain able for
economic growth and poverty decline. 78.9 percent remittance is being used in daily
consumption and only 2.9 percent of the total remittance is used for capital formation.
According to the Nepal living standard survey 2014, showed the reduction in poverty
level but rises in income inequality. The gap between the poor and rich has widened
in the country. Gini-coefficient measure the inequality in the country‟s stood at 0.328
with respect to consumption such measures urban and rural areas are 0.353 and 0.311
respectively.

HDI 2018 has published by UNDP Nepal a show country is human development
index has improved over all but inequality between region and social group remain
despite signs that the disparities are shrinking. The gaps between urban and rural areas
and ethnicities have not change with underdeveloped regions. According to the
geographical indices, Kathmandu 0.632, Lalitpur 0.601, Kaski 0.576, Bhaktapur

0.573 and Manang 0.568. These highest HDI. Similarly Mugu 0.364, Bajhang 0.365,
Kalikot 0.374, Humla 0.376, Achham 0.378 are lowest HDI. The HDI value
compared to social groups such as Hill Brahmins 0.557, which is highest and Madhesi
Dalit 0.400 which is lowestHDI value(UNDP, 2018).

12
 CHAPTER-III
RESEARCH METHODOLOGY

3.1 Introduction of the Study Area

The district‟s headquarter name is Tamghas, which is lying in 1,280 m above from the
sea level. The total population of this district has 2, 28,102 and among them 128049
and 100053 are female and male respectively. Total literacy rate of my district is
67.015 percent and male and female literacy rate are 78.185 percent and 58.63
respectively (District profile of Gulmi: 2018).

According to the Dhurkot rural-municipality profile 2017, total area of this rural
municipality is 33.33 square kilometer and total population has 4087, among them
1938 male and 2149 are female. In the study area, 71 percent people are literate,
among them 62 percent are female and 80 percent are male literate.

The research area is the Dhurkot rural-municipality of Gulmi district, western hilly
region of Nepal. Gulmi district has formed by 10 rural-municipalities and 2
municipalities. Dhurkot rural-municipality is selected for the purpose of this study.
Some few people are very rich and more people are lying in the poor condition The
major occupations of this study area are agriculture, services and business.

Dhurkot rural-municipality are divided into nine units easy for the study such as
Gope, Khahare and pipalneta, Rautadi, Bhuwana and Golpokhari, Barbot, Dhura and
Dadra, Jumladi, Katauje and Thati, Nayagaun , Bastu, Hadhade, Harre, Chautara.

3.2 Research Design

The present study is micro study of income and expenditure. The approach of this
study is descriptive as well as analytical. The study has made an analysis of existing
state of the income distribution and expenditure in the study area.

3.3 Source of Data

This study is based on primary as well as secondary sources of data. Primary data has
been collected through structured questionnaire direct personal interview and

13
observation of the study area. This is done to obtain an unbiased and fair study.
Secondary data has been collected data published sources such as 14th as national plan
by Planning Commission, 3rd Nepal living standard survey by Central Bureau of
statistics, Gulmi district profile by Gulmi district, Dhurkot rural-municipality profile
by Dhurkot rural-municipality.

3.4 Method of Sample Selection

According to the population census 2017, there are 914 household in the study area.
Among them, 10 percent household has been taken as sample from each unit. Total
households are divided into 9 units. Each sample unit has been selected by simple
random sampling without replacement.

3.5 Method of Data Collection

Questionnaire Survey is the method of data collection. Information has been collected
by conducting personal interview with household member who are well known about
the economic activities in their family and observation of each households.

3.6 Data Processing

In this study, editing, classification and tabulation are the method of data processing.
And a master table has been prepared from the completed questionnaire incorporating
the different socio-economic. Characteristics such as income from different resources
and expenditure in various sectors.

3.7 Methods and Tools of Data Analysis

Various statistical tools such as Range, coefficient of variation, Lorenz curve

and Gini-coefficient are used to measure the extent of income inequality.

a) Range

Range is the simplest measuring of the inequality. It is defined as the

difference between the largest (L) items of income and the smallest (s) items of
income of the series and is mathematically given by

14
Range (R) = L-S

b) Coefficient of variation (C.V.)

The relative measure of dispersion based on the standard deviation, known as

the coefficient of standard deviation is defined as

Coefficient of SD = SD


mean x

Similarly coefficient of variation is defined as the coefficient of S.D multiplied by 100


Coefficient of variation (C.V) = 100

It is the unit less measure of dispersion. It is useful in comparing two or more

variables which is related to income.

The less value of C.V. shows that less inequality. The greater value of C.V. shows
that greater inequality.

c) Lorenz Curve

The Lorenz Curve is a graphical method of studying the dispersion in a distribution. It

is most commonly used technique to show the income inequality which is simple
geometric device propounded by Dr. Max O. Lorenz is known as Lorenz Curve
(Kanel 1993).

Max O. Lorenz an economic statistician has for the first time used to measure
distribution income and wealth in USA. This technique consists of plotting the
cumulative proportion of income value held along the vertical axis and cumulative
portion of frequencies held along the horizontal axis. The line rising from south west
corner to north east corner represent the line of equal distribution (Perfectly equality
line) when the Lorenz curve lies below the diagonal, the area between the Lorenz
Curve and diagonal indicates the degree of inequality. The largest the area the greater
will be the inequality and vice versa.

15
d) Gini-Coefficient

Gini-coefficient is also the most commonly used measure of income inequality. It is

considered the very powerful tool to the study of income distribution. It measures the
extent to which the distribution of income among households or individuals within a
community or an economy deviates from perfectly equal distribution.

Gini-coefficient is defined as the area between Lorenz curve and the line of perfect
equality (diagonal line) divided by the area of triangle under the diagonal line.

The area between the diagonal line and Lorenz curve is denoted by „A‟ and area of
triangular figure below the Lorenz curve by „B‟ then Gini-coefficient coefficient (GC)

GC =

GC = A

AB
If everyone has same income the Lorenz Curve overlaps with the line of perfect equality. In
this case, the area between line of perfect equality and Lorenz Curve is zero. Therefore in
this case Gini-coefficient equals to zero. i.e.

(GC = 0) GC = 0
=0
0B

If all income is enjoyed by only one individual or household, then Lorenz covers the

A A
whole area below the 450 line (equality line) then B = 0 so that GC = = = 1
A0 A
When

GC = 1, which is known as the perfect inequalities of the income distribution. Therefore, the
value of Gini coefficient‟s ranges from zero to one i.e  GC  1.In simple words, it higher

16
value of Gini-coefficient then higher in inequality and if lower value of Gini-coefficient then
lower the inequality. If GC = 0 then maintain perfect equality in income distribution.

The following simple algebraic formulae can be used to complete Gini-coefficient for
ungrouped data

GC = n 1  2 ny  (n 1)y ... y 

1 2 n
n n2 y

Which is also written as

GC = n 1  2(n 11) yi

n n yi

(Where i = 1, 2, 3 … n)

n = Number of income receipt units

yi = Income received by its unit.

For grouped data.

GC =
1
 xiyi1 xi 1yipercent
100

Where,

Xi = Cumulative of variable on x-axis

Yi = Cumulative of variables on y-axis

17
 CHAPTER-IV
PRESENTATION AND ANALYSIS OF INCOME
DATA

This chapter includes the presentation and analysis of the data. This chapter consists
of three sections namely level and sources of household income, pattern of household
expenditure and measure the level of income inequality. Socio-economic background
of the study area pattern of land holding by different caste group size and distribution
of income by household size group by size of income by household size group by size
of land holding. Researcher selection for the study because her birth place in there.

4.1 Level and Sources of Household Income

The study has tried to analyze the socio-economic background and land holding
pattern of the people of study area. It is tried to present the sources of household
income and level of household income. Agriculture is the main occupation of the
people in the study area. Which is a major sources of household income. 44.94
percent people is engaged in non-agriculture earning activities such as labouring and
business and foreign employment. 36.35 people is engaged in animal production. In
the case of income sources the whole sources of income are divided into three
categories viz. agriculture and non-agriculture and other for the level of income, per
capita income of the study area is calculated.

4.1.1 Socio Economic Background of the Study Area

The socio-economic condition of the study area shows the different caste, culture and
diversity heterogeneous. Chhetries are the predominant group found wide spread in
the study area. Brahmans, Chhetries, Magar and other occupational castes are also
distributed all over the study area.

According to the district profile of Gulmi, in the study area, Magars are occupying the
highest position in the total population of the village (study area).

The following table shows the caste/ethnic composition of the study area.

18
 Table 4.1
Caste Ethnic Composition of Study Area

S.N. Caste/Ethnic Groups Male Female Total Percentage

1. Magar 577 793 1370 33.52
2. Chhetri 488 757 1245 30.46
3. Kami 207 290 497 12.16
4. Brahman 171 210 381 9.32
5. Sarki 81 111 192 4.70
6. Sanyasi/Dashanami 51 81 132 3.23
7. Dhami/Dholi 59 72 131 3.21
8. Damai 17 32 49 1.20
9. Thakuri 13 33 46 1.13
10. Thami 14 16 30 0.73
11. Others 7 7 14 0.34
Total 1685 2402 4087 100

Source: District profile of Gulmi, 2017

Magars has occpied 33.52 percent population. Chhatris and Kamis constitute second
and third largest groups in the study area. Similarly Brahman, Sarki, Sanyasi, Dhami,
Thakuri and Thami and others are constituting fourth, fifth, sixth, seventh, eighth,
ninth, tenth and eleventh position respectively. In the study area, male population is
less than female population, showing by this table.

Table 4.2
Distribution of Economically Active Population by Occupational Structure

S.N. Occupation Male Female Total Percentage

1. Agriculture 384 857 1241 77.51
2. Service 177 16 193 12.05
3. Business 25 9 34 2.12
4. Industrial 1 2 3 0.18
5. Wage labour 30 100 130 8.11
Total 617 984 1601 100

Source: Dhurkot rural-municipality, Profile, 2017

19
In the study area, a lot of peoples are employed by the agricultural occupation and
then they are also using service, wage labour and business occupation, respectively.
Only 3 persons are using industrial occupation which is least than others.

Table 4.3
The People Are Employed in Foreign Countries

Ward No. India Others Countries

Number Percentage Numbers Percentage Total
1 23 50.0 23 50.0 46
2 33 56.9 25 43.1 58
3 48 55.2 39 44.8 87
4 39 55.7 31 44.3 70
5 53 63.1 31 36.9 84
6 24 77.5 7 22.6 31
7 15 62.5 9 37.5 24
8 24 45.3 29 54.7 53
9 61 64.2 34 35.8 95
Total 320 58.4 228 41.6 542

Source: Dhurkot rural-municipality, profile, 2017

The table 4.3 shows that, more peoples are employed in India than other foreign
countries of the study area. 58.4 percent people are employed in India and 41.6 people
are employed in other foreign countries. 24 people are employed in India from ward
no.6 out of 31 which highest then other wards. Similarly 39 people are employed in
other countries from ward on 3 which is highest than other wards. In the study area,
548 people are employed in the foreign countries.

According to the Dhurkot Rural municipality profile, 2017, per family annual income
is Rs. 63104 and expenditure is Rs.50482 so that the annual saving is Rs.12622.

This study has tried to analyze the socio-economic background of the sample
household in the study area. The size of population by age, gender, caste/ethnic
educational status, living standard, economic status, occupational consumption etc.

20
have been main indicators of the socio-economic characteristics of the society.

Firstly, the table 4.4 is used to illustrate the total population of sample household by
age and gender.

Table 4.4
Population Distribution by Age Group

Age group in Population

Male Percent Female Percent Total percent
Years
0-14 86 36.44 94 30.32 180 32.97
15-59 126 53.39 186 60.00 312 57.14
60 and above 24 10.17 30 9.68 54 9.89
Total 236 100 310 100 546 100

Source: Field Survey, 2018

The table 4.4 shows that the total sample population of the study area is 546. Out of
which 236 (43.22%) are male and 310 (56.78%) are female with 32.97 percent are
lying in the group 0-14 years. 57.14 are lying in the group 15-59 years and 3.89
percent are lying in the age of 60 years and above. From the same table it is evident
that out of 546 people, 312 (57.14%) are economically active and remaining 234
(42.86%) are economically inactive (dependent). According to the population census
2017, 15091269 (56.96%) are economically active population and 11403235
(43.04%) are economically inactive or dependent population lying in Nepal (Source:
CBS 2018).

In the study area the dependency ratio between economically active and inactive
population is 75 percent (Annex I) which is equal to the national level.

Education is the third eye of the persons of the society that helps to recognize who
they are? Education plays key role for the development of the society. The table 4.5
shows the educational status of the sample population. The number of population who
have S.L.C and above S.L.C is included in literate group.

21
 Table 4.5
Educational Status of the Sample Households

S.N. Educational status Male Female Total Percentage

1. Illiterate 25 87 112 20.51
2. Literate 46 67 113 20.70
3. S.L.C 125 118 243 44.51
4. Above S.L.C 40 38 78 14.28
Total 236 310 546 100

Source: Field Survey, 2019

The above table 4.5 represents that in total sample population 79.49 percent are
literate which is higher compared with national level (68.6%) and 20.51 percent
population are illiterate. In the case of literate population the number of literate male
is lower than the number of female literate. Among the literate population, 113 have
read and write 243 persons have gained S.L.C. and 78 persons have gained above

S.L.C. In the study area, the illiteracy population of male is lower than female. It is
because the tradition of early marriage system and conservative idea of the people that
the daughter should not read and write and they should be only housewife.

In terms of caste analysis, the major caste in the study area is Magar, Chhetri,
Brahmin, Thakuri, Dasnami/Sanyasi, Dhami, Damai, Kami and Sarki etc. In this area
the number of Magar and Chhetri is more than other caste. The table 4.6 represents
the clear picture of caste-wise distribution of sample population.

22
 Table 4.6
Caste/Ethnic-wise Household and Population

Caste No. of Percent No. of Percent Average

Household People Household

Size
Brahmin 6 6.52 33 6.04 5.50
Thakuri 2 2.17 9 1.65 4.50
Chhetri 24 26.09 125 22.89 5.20
Magar 36 39.13 218 39.93 6.06
Dasnami/Sanyasi 5 5.44 31 5.68 6.20
Dhami 2 2.17 15 2.75 7.50
Damai 3 3.26 20 3.66 6.66
Kami 9 9.78 64 11.72 7.11
Sarki 4 4.35 25 4.58 6.25
Others 1 1.09 6 1.10 6.00
Total 92 100 546 100 6.10

Source: Field survey, 2019

From the table 4.6, it is clear that out of total 92 sample households, 32 household
(34.78%) and out of 546 sample population 167 (33.43%) are belong to higher caste
such as Brahmin Chhetri and Thakuri. 43(46.73%) households and 264 (48.60%) are
belong to the Janajati similarly 17 (18.47%) household and 115 (21.06%) are belong
to the lower caste (Dalit). The average in Thakuri (4.50). the average household size
of this study area is 6.10 which is more than that of the average household size of
Gulmi district (4.78) (District profile, Gulmi 2017)

The main occupation of this study area is agriculture. Large number of people is
engaged in agriculture. After agriculture some people are engaged in services and
business. To obtain occupational status the nature of the work is divided into six
categories as agriculture, services, business, foreign employment wage labour and
industry. Table 4.7 demonstrates the occupational status of the study area.

23
 Table 4.7
Occupational Status of the People of 14 Years and Above

Occupation Household Member Percent

Agriculture 135 36.88

Foreign employment (India and abroad) 92 25.14

Services 76 20.76

Wage labour 45 12.29

Business 15 4.10

Industrial 3 0.82

Total 366 100

Source: Field survey, 2019

The table 4.7 shows that among 366 people of 14 years and above 135 36.88 percent
are in agriculture which is lower compared to the national level of the population
engaged in agriculture is about 60 percent and 25.14 percent people in engaged in
foreign employment. Similarly 21.76, 12.29, 4.10 and 0.82 percent people are
engaged in services, wage labour, business and industrial job respectively. Among
these occupational statuses, foreign employment is increasing rapidly than other
occupation. It is showing valuable equipment for poverty reduction. According to the
NLSS-III, 55.8 percent of the households receive remittance with teach households
receiving Rs. 80,436 a year. But we should not dependent on remittance we must be
developed other occupational sectors by using national resources in our country (CBS,
Nepal living standard survey, 2017).

4.1.2 Land Holding

Among the various factors of production in economics, land is an important factor of

production. So, there is positive relationship between land holding and household
income. Most of people are suffering from poverty and unemployment because of
unequal distribution of income. Land is important sources of income so that sufficient
distribution of land generates income. In this Dhurkot rural-municipality, a huge mass

24
of people is engaged in agriculture sector i.e. 35.72 percent according to this survey,
the land which has irrigation facilities is known as wet land and which has no
irrigation facilities is regarded as dry land. Paddy, wheat, mustard, potato, pulses
vegetable etc. are major products in wet land and maize, mustard, barley, potato, fruits
etc. are produced in dry land. Agricultural land distribution is not equal and
proportional in this study area. Most of the household have low amount of land to
cultivate and remaining small portion of households have comparatively high amount
of land. Table 4.8 represents the distribution of the size of land holding for cultivation
among the sample household.

Table 4.8
Distribution of Size of Landholding among the Sampled Household

S.N. Size of No of Percent of Land Average size

Percent of
Land in Household Household Holding in of Land Land

Ropani (Ropani) Holdings Holding

1. Landless 1 1.08 - 0 0
2. 0-10 23 25.00 168 7.30 15.58
3. 10-20 60 65.23 725 12.08 67.25
4. 20-30 6 6.52 112 18.67 10.39
5. 30+ 2 2.17 73 36.5 6.78
Total 92 100 1078 11.72 100

Source: Field survey, 2019

Above table 4.8 shows that 65.23 percent sample households in the study area has
67.25 percent of land while 1.08 percent has no land to cultivate so that 60 households
have (10-20) Ropani of land and average size of land holding is 12.08. Similarly 2
household have more than 30 Ropani of land to cultivate and average size of land
have 36.5 Ropani. The average landholding in the study area is 11.72 only. Above this
table 4.8 shows that the inequality of land holding in this study area.

In the study area the distribution of land is not so equitable among the caste groups.
Nearly entire land is occupied by only Brahmin and Chhetri. Other caste has very few

25
lands. Among them Dalit have nearly landless. The table 4.9 shows the size of land
holding by caste groups.

Table 4.9
Size of Distribution of Land Holding by Caste/Ethnic Groups

Caste Group No. of Size of Land Percent Average Size of

HHs Holding (in Ropani) Land Holding

Brahmin 6 108 10.09 18.00
Chhetri 24 386 35.82 16.08
Magar 36 362 33.58 10.05
Dhami 2 17 1.58 8.5
Dasnami/Sanyasi 5 64 5.94 12.8
Damai 3 20 1.85 6.67
Kami 9 78 7.24 8.66
Sarki 4 18 1.66 4.5
Thakuri 2 19 1.67 9.5
Others 1 6 0.57 6.0
Total 92 1078 100 11.72

Source: Field survey, 2019

The above table 5.6 shows that 6 household is Brahmin who occupies 108 Ropani and
10.09 percent of total land which is 18.00 average landholding by this caste which is
highest than other caste groups. 24 sampled household are Chhetri who occupy 386
Ropani and 35.82 percent of total land and that has 16.08 percent average
landholding. On the other hand, 36 sample households are Magar who occupy 362
Ropani and 33.58 percent of total land which has 10.05 average landholding.
Similarly, 2, 5, 3, 9 4, 2, 1 of sample households are Dhami, Sanyasi, Damai, Kami,

Sarki, Thakuri and others who are occupying 17, 64, 20, 78, 18, 19 and 6 Ropani
and1.58, 5.94, 1.85, 7.24, 1.66, 1.67 and 0.57 percents of total land which are 8.5,
12.8, 6.67, 8.66, 4.5, 9.5 and 6.0 average land holding.

26
The average size of landholding of 92 sample household is 11.72 which is less than
average land holding of Brahmin and Chhetri, Brahmin and Chhetri have more
landholding than other castes. Damai, Kami, Sarki and others are lowest landholding
castes in the study area. Thus, the size of distribution of landholding is unequal among
caste group. Dalit have occupies lowest level of average size of landholding.

4.1.3 Sources of Household Income

For the income earning activities, there are various sources different types of crops
production, livestock farming services, labour work and business and industry and
foreign employment are major sources of income n the study area. Income from crops
production and income from livestock and their products are included in agricultural
sources and income from salaries, wage and profit are included in non-agricultural
sources. Table 4.10 presents the clear picture of sources of income and level of
income.

Table 4.10
Level and Sources of Household Income

Sources Total Household Income Per Day (Rs.) Percent

Agricultural 30856 55.06
Non-agricultural 25187 44.94
Total 56043 100

Source: Field Survey, 2019

From the table 4.10 it is clear that agriculture is main sources of household income in
the study area. It contributes 55.06 percent of the total household income per day and
non-agricultural sources of income contribute 44.94 percent of total household
income per day.

The above three major sources are separately described below for detailed
information. The following table 4.11 is useful for this purpose.

27
 Table 4.11
Level and Sources of Income

Sources Total Household Income Per Day Percent

(Rs.)
Agricultural 30856 100.00
 Crops production (food and cash) 19640 63.64
 Livestock and their production 11216 36.35
Non-agricultural 25187 100.00
 Wage 4234 16.81
 Salaries 8082 32.09
 Business an cottage industries profit 3021 11.99

 Foreign employment 9850 39.11

Source: Field Survey, 2019

Table 4.11 shows that in agricultural source, income from crops production is higher
than income from livestock and their products. Crops production holds 3.65
percentage share income of agricultural sector, whereas income from livestock and
their products has contributed 36.35 percent share. Likewise on non-agricultural
sector income from salaries has covered 32.09 percent share of household income.
The sources of income from foreign employment has covered highest 39.11 percent
share. Similarly income from wage and profit from business and cottage industries
have covered 28.80 percent. Profit form business and cottage industries has covered
lowest 11.99 percent share of household income.

4.1.4 Level of Household Income

For the level of household income per capita daily income of the study area is
calculated. The average household income per day is 609.16 and average household
size is 5.94 in the study area. By dividing average household per day income by
average household size we get per capita daily income NRs. 10255. The annual per
capita income of study area is 37430.75 NRs. Or US$ 360 which is lower than that of

28
per capita income of whole Nepal is US$ 735 (National account of Nepal 2017 CBS).
In this study an attempt is made to determine the level of household income by size of
household which is presented in the table 4.12.

Table 4.12
Level of income by HHs size

HHs Size No. of Percent Total Percent Per HHs Per Average% of
HHs Income Per Day Income Per HHs Daily

Day Income
0-4 4 4.35 1620 2.89 405 12.92
4-8 68 73.91 34562 61.67 508.26 16.22
8-12 18 19.57 17346 30.95 963.67 30.74
12+ 2 2.17 2515 4.49 1257.50 40.12
Total 92 100.00 56043 100.00 3134.43 100.00

Source: Field Survey, 2019

From the table 4.12 we can see that higher the household size higher the average
income. The household size 0-4 the mean household income per day NRs. 405.00
where as the households consisting 12 and above has NRs. 1257.50. The size of
household 4-8 consists largest number of household, which has mean household
income per day Rs. 508.26. Similarly, the HHs size is 8-12, the mean household
income per day 963.67. The lowest household of group has covered 4.35 percent of
total sample household but it covers 12.92, percent of average of percentage of daily
household income on the other side, the largest household size group has covered only

2.17 percent of total sample households and it covers largest share of the average
percentage of daily household income i.e. 40.12 percent. This shows that as the
household size is large the income level is also high. Hence, there is positive
relationship between level of income and the level of household size.

29
4.1.5 Adequacy of Income

In this study, it is tried to analyze the responses received from the respondents
regarding their views towards the adequacy of income for consumption expenditure.
Respondents were asked to give their opinion about their income level if it was less
than adequate, just adequate and more than adequate, the response obtained under the
study is analyzed in the following table 4.13.

Table 4.13
Adequacy of Income

Adequacy No. of Households Percent

Less than adequacy 52 56.52
Just adequacy 24 26.09
More than adequacy 16 17.39
Total 92 100.00

Source: Field Survey, 2019

In the table 4.13, it is clear that out of 92 sample household in the study area 56.52
percent responded that their income was less than adequate. The share of households
indicating their income to be just adequate comprises 26.09 percent. And 17.39
percent of households respondent to have a more than adequate for their life sustain.
This type of disparity in the adequacy of income also proves that there is high degree
of inequality in the distribution of income.

4.2 Expenditure Pattern

Consumption is positive function of the level of income in the context of rural

economy of Nepal. Expenditure or consumption pattern is influenced by various
factors such as income status, family size, geographical situation, farm size,
education, culture and tradition and so on. According to the Keynes, the functional
relationship between consumption and income is based on the psychological law of
consumption behaviour which states that when income increased consumption
expenditure also increases but by a smaller amount i.e. there is non-proportional
relationship between the increase in income and expenditure.

30
In the study area, trend of consumption expenditure is affected by various factors.
Income is disposed into different items of expenditure i.e. expenditure in food items,
non-food items, livestock, agriculture expenditure, education expenditure, religious
function and so on. In this chapter an attempt is made to indicate the level of pattern
of household expenditure in the study area.

Food items includes rice, pulse, meat, flour, curry, milk and milk product, fruits,
cooking oil, tea, vegetable so on. Non-food items include cloths, foot wear, education,
health care, festival, smoking, lightening and so on. Interns of expenditure on
livestock veterinary, feeding etc. are included. Similarly expenditure on agriculture
includes expenditure on seeds, fertilizers, insecticides, labour, machinery and plough
etc.

Generally the consumption expenditure is high in food and non-food items it is

because of three basic needs of people (food, cloths and settlement). Table 4.14
presents the pattern of daily household expenditure.

Table 4.14
Pattern of Households Expenditure

Items of Total Expenditure Per Day (NRs) Percent

Expenditure
Food-item 18620 36.39
Non-food item 15400 30.10
Live stock 6696 13.09
Agriculture 10447 20.42
Total 51163 100.00

Source: Field Survey, 2019

The table 4.14 shows that maximum share of household income is spent on food item
and minimum in livestock expenditure i.e. the highest level of daily expenditure is on
pattern of food item and lowest on livestock. Food items cover 36.39 percentage of
total household expenditure whereas non-food items cover 30.10 percent. Thus,
expenditure on livestock and agriculture has contributed 13.06 percentage and 20.42

31
percent share respectively.

4.2.1 Pattern of Household Expenditure by HHs Size

Analysis of the pattern of household expenditure by household size has also been
carried out in this study. Generally there is a positive relationship between household
size and level of household expenditure. i.e. higher the household size higher will be
the consumption expenditure and vice versa. In the large family the dependency ratio
is higher than in small family. Hence, the large family has relatively high expenditure.
The per capita household expenditure is calculated to obtain the level of household
expenditure. The average size household daily expenditure in the study area is 556. 12
and average household size is 5.94. by dividing average size of household daily
expenditure by are rage household size, the value of per capita daily expenditure
obtained is NRs. 93.62 and annual per capita expenditure is NRs. 34171.30 i.e. US
$328.57. Hence, the large family has relatively high expenditure family size
categorized into four groups for the analysis of household expenditure by family size
which is given below.

Table 4.15
Patterns of Household Expenditure by Family Size

Family No. of Percent Total Percent Per HHs Average% of

Size HHs Expenditure Daily HHs Daily
Expenditure
Per Day Expenditure
0-4 4 4.35 1400 2.74 350 11.97
4-8 68 73.91 31586 61.74 464.50 15.88
8-12 18 19.57 15650 30.58 869.l44 29.72
12+ 2 2.17 2527 4.94 1241 42.43
Total 92 100.00 51163 100.00 2924.94 100.00

Source: Field Survey, 2019

Table 4.15 shows that higher family size, higher is the average percentage of per
household daily expenditure. The smallest family size group has only 4.35 percent of
household which is 2.74 percent of total expenditure and average household daily

32
expenditure is 11.97 percent. The largest household group has only 2.17 percent of
household which has 4.94 percent of the total expenditure per day and average
household daily expenditure is 42.43. The largest number of households and its
expenditure is concentrated 4-8 which is 73.91 percent of total household and 61.74
percent of total expenditure and its average percentage household daily expenditure is
15.88.

4.3 Measure the level of Income Inequality

This study has tried to measure the income inequality of the people of study area by
using simple tools and techniques such as Range, Relative mean deviation, coefficient
of variation, variance etc. from the primary data. It implies the range or area of the
inequality in the income distribution. Income inequality shows the unequal
distribution of income or wealth so that this study includes the income distribution of
the study area, graphical presentation of income distribution, measurement of income
inequality level and alternative indicators of measuring the level of income inequality.

4.3.1 Income Distribution of Study Area

The word income inequality is familiar and interesting word in economic literature.
Economist and statisticians have propounded different type of methods to show the
concentration of income and wealth. Among the different methods, Gini-
concentration ratio and Lorenz curve methods are very widely employed in analysis of
income distribution by size. For sensitivity of the Gini-coefficient depends not on the
size of income levels but on the number of people in between them. One
characteristics of Gini-coefficient is that it does not imply a strictly concave group a
linear functions of income level. This is very obvious since „G‟ is a linear function of
income level. This property has come under attack recently. But is not clear how
serious an objective it really is (Sen 1975).

Income plays a vital role determining the living standard of people. Inequality in
income distribution is one of the obstacles of achieving social justices and welfare. In
order to study the income distribution, total sample household divided into 10 decile
groups. Each group contains 10 percent of total sample household. It has taken ranked
from low income group. Thus first decile group covers 10 percent of households with

33
low income group and last decile covers 10 percent household of high income. The
per capital daily income is used for analysis in this study. Table no. 4.16 presents a
clear picture of percapita daily income distribution among the decile.

Table 4.16
Distribution of Income by Decile

Percent Population % of Cumulative in Income Average % Cumul

of HHs in Decile Population Decile Per of Per Capita ative
In Decile Capita Daily Income
% of
Per Day
Income
1st 10 64 11.72 11.72 703.02 6.99 6.99
2nd 10 48 8.79 20.51 758.42 7.54 14.53
3rd 10 56 10.26 30.77 781.55 7.78 22.31
4th 10 59 10.81 41.58 809.31 8.05 30.36
5th 10 67 12.27 53.85 866.86 8.63 38.99
6th 10 52 9.52 63.37 906.73 9.02 48.01
7th 10 50 9.16 72.53 999.00 9.94 57.95
8th 10 67 12.27 84.80 1028.51 10.23 68.18
9th 10 40 7.33 92.13 1562.49 15.55 83.73
th
10 10 43 7.87 100.00 1634.93 16.27 100.00
Total 546 100.00 - 10050.82 100.00 -

Source: Field Survey, 2019

Table 4.16 shows a real picture of income distribution among sampled household.
Income is not distributed equally and fairly in the decile groups. Bottom 11.72 percent
of population has received only 6.99 percent of total actual income where as top 7.87
percent of population has received 16.27 percent of total income. Thus percentage
share of income among decile group seems very unequal. The distribution of income
in 10 decile group is also presented graphically in the following sub-chapter.

34
4.3.2 Graphical Presentation of the Income Distribution

With respect to household per capita income and household number, we can draw
Lorenz curve. The Lorenz curve shows the difference between equal distribution and
actual distribution of income. The area between the line of equal distribution (450
lines) and actual distribution line is called area of concentration. The greater area of
concentration represents the large magnitude of inequality and vice versa. The graph
no. 1 presents the inequality in income distribution among the decile groups.Figure 1

In the above figure 1 cumulative percentage of income is plotted in y-axis cumulative

percentage of population is plotted in x-axis. OA is the line of equal distribution and
OBA is the area of concentration. The area between on and OBA is the area of
concentration. The Lorenz curve drawn above shows that there is inequality in income
distribution.

4.3.3 Measurement of Income Inequality Level

Income inequality level shows the how much inequality is there in the distribution of
income or it implies the range or area of the inequality in the income distribution. In
order to measure the level of income inequality, Gini-coefficient is the measure of

35
inequality or concentration whose values lies between 0 and 1 (Symbolically i.e.
0  GC  1). There is general assumption that as the value of Gini-coefficient of
approaches to zero, it means there is less inequality in the distribution of income and
vice versa. In simple meaning to say if the value of Gini-coefficient is zero then the
Lorenz curve concede with 450 lines, this situation shows the perfect equality in
income distribution. If the value of Gini-coefficient lies between near to the zero and
one then this situation shows that the distribution of income is less inequality and
more inequality. If the value of Gini-coefficient is one then which is known as perfect
inequalities of the distribution of in this situation Lorenz curve covers the whole area
below the 450 line.

Considering the individual data series of per capita daily income Gini-coefficient
calculated is 0.916 (Annex II). It means that there is high level of inequality in the
income distribution. The value of Gini-coefficient of some selected countries and
study areas is presented in table 4.17 the comparative study.

Table 4.17
Value of Gini-Coefficient

Countries/studies Gini-coefficient
Bangladesh + 0.310
Maldives + 0.370
Pakistan + 0.362
Nepal + 0.395
Bhutan + 0.374
Srilanka + 0.514
Kirtipur Municipality * 0.31
Dhurkot Rural-Municipalty ** 0.916

Source: Field survey, 2019

(+) Key indicators of developing Asian and pacific countries 2011, Asian
development Bank

(*) Subedi Kapil Prasad, poverty in Urban Nepal: A case study of Kirtipur

36
municipality of Kathmandu district

(**) Present study

From the table 4.17 we can see that the value Gini-coefficient in the study area is 0.92
which is very greater than that value of Nepal i.e. 0.395. This value shows that high
income inequality in the study area. In the comparative study among given countries,
the highest value is in Sri-Lanka is 0.514 and lowest is in Bangladesh and Pakistan are

0.310 and 0.62 respectively. The Gini-coefficient of Nepal is 0.395, which is greater
than Bangladesh and Pakistan‟s value and less than Sri-Lanka, Maldives and Bhutan
so that the distribution of income is satisfactory of Nepal among in these countries. As
due value of Gini-coefficient is small there is less income inequality.

4.3.4 Alternative Indicators of Measuring the Level of Income Inequality

Beside Gini-coefficient ratio to measure the level of income inequality, various

statistical tools such as range variance, coefficient of variation and mean deviation
etc. can be used. The table 4.18 represents others alterative indicators of measuring the
level of income inequality in the study area (See Annex III).

Table 4.18
Alternative Indicators of Measuring the Level of Income Inequality

Values

Statistical Tools
Range 35.87

Relative mean deviation 0.244

Variance 10.045

Coefficient of variation 0.317

Source: Field Survey, 2019

37
 CHAPTER-V
SUMMARY, CONCLUSION AND
RECOMMENDATION

5.1 Summary of the Major Findings

Nepal is predominately an agricultural country where an inequality in income

distribution is highly noticed and it varies differently among different places because
of diversification in their socio-economic structure. The present study has focused its
analysis on the size distribution of incomes and expenditure to measure the income
inequality and different sources of rural income. Primary sources of data have been
used for computing the Gini-coefficient ratio to fulfill specific objective of this study.
The major findings of the study area are as follows:

 In the study area, expenditure in food items covers 36.39 percentage of total
household expenditure per days where as non-food items covers 30.10 percent
per day.
 In the study area, 73.91 percent household expenditure is 61.74 but 2.17
percent household spent 4.94 percent of total expenditure per day.
 Expenditure of smallest family size (0-4) have 2.74 percent and largest family
size (12+) have 4.94 percent of total expenditure per day.
 In the study area 2.17 percent household have 36.5 average size of land
holding but 65.23 percent household have 12.08 average size of landholding
and 1.08 percent have no land.
 In the occupational structure, 36.88 percent people are engaged in agriculture,
25.14 percent foreign employment and 0.82 percent people are engaged in industry.
 Out of 546 population, 79.49 percent are literate which is higher than national
level (68.0%) and 20.51 percent population are illiterate.
 The average household size is found to be 5.94.
 The per day average per capita income in the study area is estimated as 102.55.
 In the study area, it is found that most land is held by Chhetri 35.82 i.e.
percentage and Magar 33.58 percent of cultivate land. Brahmin has occupied

38
  10.09 percent land only similarly Damai, Kami and Sarki group have low
percentage of land. They are nearly landless.
 In the study area the value of Gini-coefficient is 0.916.
 In this study area, a large portion of sampled population has engaged in
agricultural sector which has covered 55.06 percent household income per
day. But remain people are engaged in non-agricultural sector, this sector
consists services. Industry, business and foreign employment, it covered 44.94
percent household income per day in the study area. Among them largest
number of people are employed by foreign sector. It has covered 39.11 percent
household income per day. Every year they have gone to foreign countries for
employment. This is another source of income of that area. I think this source
is not sustainable for them.
 More than 56 percent of sample households responded that their income is
inadequate for life sustain. To fulfill the inadequacy, they should spend from
previous saving which leads to decrease in saving.

5.2 Conclusion

This research has been conducting to know the income and expenditure of the study
area. It has focused on income inequality measurement of the people. This study has
been showed difference between income and expenditure pattern of the people in the
study area. It has been seen unequal distribution of income among the people. The
major conclusion of the findings of the study area are as follows.

 There is no enough sources of income besides agriculture of the study area.

 The poor people in the study area have a small portion of land. It is an obstacle
for the adequate income generation in the study area. The lack of irrigation
facilities and lack of modern agricultural system, has seriously affected the
output and income generation. This condition has helped to income and
thereby raised inequality in income distribution.
 In this study area, a large portion of household income is found to be spent on
food consumption and other extravagant activities. Conversely, the part of
income which is spent on education health and is found corporately low than

39
  other sectors which further makes the people poorer than before and there by
increases income inequality.
 In this study area, a large portion of sampled population is found to be
dependent on agriculture, livestock, farming. Because of the lack of enough
industrial development and other occupations peoples are either employed or
semi employed. Whenever they are employed they may have very low
income. This means low level of income, thereby inequality came in the
income distribution.
 There is positive relationship between household size and level of income. Due
to lack of enough knowledge about family planning are found raising their
family size is increasing which tends to raise dependent number and affects
income distribution adversely.
 Some religious function and festival, tradition, cultures are also instrumental
to push up income inequality. People used to spend in religious festival and
other traditions. Such types of expenses are unproductive as well as
unprofitable.
 In the study area, it is found that female illiteracy rate is higher than male
illiteracy rate.
 In the study area, it is fund that the sample households receive most of the
income from agricultural production. The second, important sources of income
are services and foreign employment in the sample household.
 The large value of Gini Coefficient indicate the vast income inequality in the
study area.
 The percentage of female population is higher than that of male.

5.3 Recommendation

It is clear that the inequality in income distribution is in the study area is very serious
although the government as well as other concerned authorities should be committed
to overcome this obstacle of economic development. To escape from this vicious
problem the following point are recommended.

 As agriculture sector is the major source of income, modern farming methods and
technique coupled with irrigation facilities should be provided for the

40
 development of agriculture in this study area.
 With heavy dependency in agriculture the villages are found to have very low
level of income. Government and NGO and INGO should provide training for
income generating activities such as bee keeping small and cottage industries etc.
 Government should establish one veterinary office in this study area for well
growth of livestock production.
 Economic development is directly affected by educational status of the people. So
in this rural-municipality should be implemented some technical education
program to push up the economic status of the people.
 Income from livestock and their products, especially goat farming is found to play
significant role in income generation of the community in the study area. Farmers
are out of proper price of their output which has adversely affected the income
generation of community. Therefore a collective effort by local people is
necessary to maintain the appropriate price.
 Targeted programs such as education for children free vocational educational
programme should be forces on poor, low income groups and female so that they
could be skilled labour focuses. Such skill development programs can contribute
to generate income and thereby help to reduce inequality in the income
distribution.
 For attaining equal distribution of income government should provide additional
job opportunities in such a way that it should help the lower income group to
increase their income level.
 To reduce the level of unemployment, labour intensive technology should be
applied wherever possible.
 Government should provide adequate amount of loan to the people without taking
any securities with nominal interest rate for people to establish small and cottage
industries.
 Similarly, provision of market, road and transportation and supporting the price of
agricultural production is favor of farmers etc. can be promoted to reduce income
inequality in the study area.
 Government should provide the job oriented technical skillful training for
backward people in the study area.

41
 Reference

ADB (2014). Key indicators of development Asia and Pacific countries. Manila:
Asian Development Bank.
Aryal, J.P., & Gautam, A. (1994). Quantitative techniques. Kathmandu: Vidhyarthi
Pustak Bhandari, III .
Bhattarai, K.R. (1983). Income distribution and poverty in rural Nepal: A case study
of Dandeldhura district (Unpublished master's thesis). Central Department of
Economics (CEDECON), Tribhuvan University.
CBS/NPC (2017). Nepal Living Standard Survey Report, Kathmandu: Central Bureau
of Statistics (CBS)/National Planning Commission (NPC).
Collins English Dictionary (2009). Social and Economic disparity (12th ed.). Oxford
University Press.
Dhurkot (2017). Rural-municipality profile of dhurkot. rural-municipality Office
Dhurkot.
Dhurkot (2018). Rural-municipality profile of dhurkot. rural-municipality Office
Dhurkot.
DPG (2017). District Profile of Gulmi. Gulmi: District Statistics Office.
DPG (2018). District Profile of Gulmi. Gulmi: District Statistics Office.
Gupta, S.P. (1983). Statistical methods (19th ed.). New Delhi: Sultan Chand & Sons
Publishers.
IFAD (1992). The State of world rural poverty. London: Intermediate Technology
Publication,
Jain, S.C. (1981). Poverty to prosperity in Nepal. Kathmandu: Development
Publisher.
Kanel, N.R. (1993). Lorenz curve and Gini-coefficient: Conceptual consideration. The
Economic Journal of Nepal, Kathmandu: Central Department of Economics
(CEDECON), Tribhuvan University.
Kuznets, S. (1995). Economic growth and income inequality. Washington, DC, USA:
American Economic Review.
Meier, G.M., & Rauch, J.E. (2000). Leading issues in economic development, (7th
ed.). New York: Oxford University Press, Madison.
MoF (2018). Economic survey. Kathmandu: Ministry of Finance Government of
Nepal. .

42
Myrdal, G. (1970). The challenge of world poverty. In 1970 Allen Lane (Ed.).
London: The Penguin Press.
NPC (2018). 14th National Plan, national planning commission (NPC), Kathmandu.
Paul, W., & Ronald, W. (1979). Economics, Oxford University Press.
Pokhrel, G. (2002). Income inequality A case study of laximipur VDC of Dang
district, Master's thesis. Kathmandu: Central Department of Economics
(CEDECON), Tribhuvan University.
Rawls, J. (1971). Theory of justices, Cambridge: Harvard University Press.
Sadden, D. (1987). Report on Nepal Labour Force Survey. Kathmandu: Central
Bureau of Statistics (CBS)/National Planning Commission (NPC).
Sen, A.K. (1997). On income inequality, Clarendon Press, Oxford University Press.
Todaro, M (1997). Economic for a developing world, (2nd ed.). New Delhi: Longman
Publisher Pvt.
UNDP (1999). Human development report. Washington, DC: United Nations
Development Program (UNDP).
UNDP (2018). Human Development Report. United Nations Development Program
(UNDP).
UNDP (2019). Human Development Report. United Nations Development Program
(UNDP).
World Bank (1990) .World Development Report. Oxford University Press.
World Bank (2001). World Development Report. Oxford University Press.
World Bank (2018). World Development Report. Oxford University Press.

42
 ANNEX-I

Computation of Dependency Ratio

Dependency ratio is computed with help of the following formula

The dependency Ratio =

Where,
Po 14  P60 
100
P15 59

Po-14 = Population of 0-14 years

P60+ = Population of 60 years and above P15-59 = Population of 15-59 years

180 54
Therefore dependency ratio = 100
312

234
= 100
312

= 75

42
 ANNEX-II

Computation of Gini-coefficient among Total Sample

Households according to per capita daily income

We can compute the Gini-coefficient of individual data

G.C = n 1  2 [ny  (n 1) y2 ... ny ]

n n2 y 1 n

n 1 2  2y ... ny ]
=  2[ y 1 1 n
n n y

y1  y2  y3 ... yn
Where, y
n

h = No. of observation

44
 So that,
1001 2
G.C =   47349.90
100 100.50 (100)2

100 2
=   47349.90

100 1005000

94699.80
= 1.01-

1005000

= 1.01-0.094

G.C = 0.916

56
 ANNEX-I

Computation of Dependency Ratio

Dependency ratio is computed with help of the following formula

Po 14  P60 
The dependency Ratio = 100
P15 59

Where,

Po-14 = Population of 0-14 years

P60+ = Population of 60 years and above

P15-59 = Population of 15-59 years

180 54
Therefore dependency ratio = 100
312

234
= 100
312

= 75

42
 ANNEX-II

Computation of Gini-coefficient among Total Sample

Households according to per capita daily income

We can compute the Gini-coefficient of individual data

G.C = n 1  2 [ny  (n 1) y2 ... ny ]

n n2 y 1 n

n 1 2  2y ... ny ]
=  2[ y 1 1 n
n n y

y1  y2  y3 ... yn
Where, y
n

h = No. of observation

So that,
1001 2
G.C =   47349.90
100 100.50 (100)2
100 2
=   47349.90
100 1005000

94699.80
= 1.01-
1005000

= 1.01-0.094

G.C = 0.916

44
 ANNEX-III

Computation of Alternative Measurement of level of income

Y Yi \ y -yi\ ( y -yi)2

10 6.99 3.01 9.06

10 7.54 2.46 6.05

10 7.78 2.22 4.93

10 8.05 1.95 3.80

10 8.63 1.37 1.88

10 9.02 0.98 0.960

10 9.94 0.06 0.003

10 10.23 0.23 0.053

10 15.55 5.55 30.80

10 16.27 6.27 42.90

100.00 100.00 24.10 100.45

Now, y =
yi =
100
= 10
N 10

N = 10 because it is taken from decile

Relative mean deviation

n \ y  yi \ 24.10
MD =    0.24
il ny 100
n ( y  yi)2 100.45
Variance (V) =   10.045
i l n 100

Coefficient of variation

44
 100.45
C.V = S tandard Deviaiton= 10  10.045
mean 10 10
3.169
=  0.32 or 0.32100=32%
10

Computation of range

Maxy min y
Range (R) =
y

358.66
=
10

= 35.87

46
 ANNEX-IV

S.N Caste Caste Household Total Income Per Capita Total Per Capital
Size Per Day Daily Expenditure Daily
Income Per Day Expenditure

1. 2 7 475 67.86 442 63.14

2. 2 5 448 89.60 361 72.20

3. 1 8 425 53.13 472 59.00

4. 2 5 660 132.00 698 139.60

5. 2 4 330 82.50 300 75.00

6. 2 4 402 100.50 390 75.00

7. 2 6 533 88.83 506 84.33

8. 2 5 385 77.00 365 73.00

9. 2 4 268 67.00 218 54.50

10. 1 6 106 17.67 112 18.67

11. 2 5 623 124.60 521 104.20

12. 2 4 565 141.25 463 115.75

13. 2 9 1100 122.22 1080 120.00

14. 2 7 789 112.71 696 99.43

15. 3 8 1232 154.00 1147 143.38

16. 3 6 1037 172.83 932 155.33

17. 1 12 970 80.83 769 64.08

47
18. 1 10 1024 102.40 1012 101.20

19. 1 6 735 122.53 764 127.33

20. 1 8 715 89.38 698 87.25

21. 2 4 398 99.50 332 83.00

22. 2 9 267 29.67 224 24.l89

23. 2 7 556 79.43 518 74.89

24. 2 5 382 76.40 292 58.40

25. 3 5 484 96.80 386 77.20

26. 3 6 655 109.17 637 106.17

27. 1 7 482 78.67 468 78.00

28. 1 12 586 48.83 588 49.00

29 1 5 325 65.00 294 58.80

30. 1 6 508 48.67 490 31.67

31. 1 6 537 89.50 432 72.00

32. 1 8 686 85.75 584 73.00

33. 1 12 932 77.67 825 68.75

34. 2 8 840 105.00 760 95.00

35. 2 5 435 87.00 428 85.60

36. 2 5 478 95.60 399 79.8

37. 2 6 439 73.17 449 74.83

38. 2 8 1167 145.87 967 120.87

48
39. 2 7 854 122.00 713 101.85

40. 2 6 432 72.00 464 77.33

41. 1 8 686 85.75 642 80.25

42. 1 9 820 91.11 744 82.67

43. 2 4 388 97.00 347 86.75

44. 2 14 1265 90.36 1155 82.50

45. 2 5 448 89.60 372 74.40

46. 2 8 737 92.13 689 86.13

47. 2 6 696 116.00 657 108.50

48. 2 7 978 139.71 885 126.43

49. 3 8 626 78.25 598 74.75

50. 3 6 786 131.00 737 122.83

51. 2 5 246 49.20 228 45.60

52. 2 L9 409 45.44 385 42.78

53. 3 6 518 86.33 457 76.17

54. 3 4 285 71.25 235 58.75

55. 3 4 1050 262.50 946 236.50

56. 3 2 676 338.00 599 299.50

57. 3 3 358 119.33 322 107.33

58. 3 4 464 116.00 398 99.50

59. 4 8 985 123.13 856 107.00

49
60. 4 4 1163 290.75 1020 255

61. 4 4 437 109.25 402 100.50

62. 4 5 529 105.80 488 97.60

63. 1 9 535 89.17 478 53.11

64. 1 4 324 81.00 386 96.50

65. 2 3 386 128.67 335 111.67

66. 2 3 418 139.33 401 133.67

67. 3 8 328 41.00 299 37.37

68. 3 5 477 95.40 426 85.20

69. 3 4 467 116.75 496 124.00

70. 3 4 375 93.75 318 79.50

71. 4 6 236 39.33 204 34.00

72. 4 5 522 104.40 492 98.40

73. 2 4 624 156.00 594 148.50

74. 2 8 675 84.37 645 80.63

75. 2 5 1048 209.60 935 187.00

76. 2 3 562 187.33 506 168.67

77. 3 4 391 97.75 312 78.00

78. 3 4 256 89.00 287 71.75

79. 3 5 307 61.40 292 58.40

80. 3 3 1165 388.33 1034 344.67

50
 81. 3 4 872 218.00 760 190.00

82. 3 3 484 161.33 475 158.33

83. 2 8 1198 149.75 1088 136.00

84. 2 9 952 105.78 898 99.78

85. 2 6 526 87.67 575 95.83

86. 2 6 589 98.18 538 89.67

87. 2 5 447 89.40 482 96.40

88. 2 5 488 97.60 438 87.60

89. 3 4 346 86.50 304 116.67

90. 3 6 770 128.33 7.00 116.67

91. 3 6 622 103.69 599 99.83

92. 3 T 548 109.60 514 102.80

Total 546 56043 10050.82 51163 9186.44

Annex-V

51
Questionnaire Design for the research on income inequality: A case study of
Dhurkot rural-municipality of Gulmi district

1. Household survey questionnaire:

Name of the respondent:

Age: Sex: Caste: Ethnicity:

Name of household head:

Family description by age and sex

How many members are currently living this household?

S.N. Name Relation Age Sex Material Occupation

status

1.

2.

3.

Educational description

Formal Education

Education Male Female Total

Under S.L.C

10+2

B.A

B.A above

Informal Education

Literate Male Female

Illiterate male Female

Occupational Structure of Economically Active Household Member

52
 Occupation Male Female

Business

Agriculture

Small and cottage industry

Industry

Wage/salary

Others

Total

2. Source of income

If agriculture is main source of income then how much land do you have?

Ropani

Account on Land Holding

What crops do you grow in your land?

Crops Ropani

Paddy

Wheat

Maize

Mustard

vegetable

52
 Account on Agriculture

Which of following agriculture production did you have last year?

Paddy

Wheat

Maize

Oil seeds

Pulses

Vegetables

Others

Total

Is your production sufficient to meet your need for whole year?

Yes No

If there is surplus how much amount do you have?

3. Account on Service:

Are these job holders in your family?

Yes No

Job is your main sources of income then how many members are employed?

Which types of do they do?

Government Private

If labour work is main source of income then how many member are engaged in
your work?

Male Female

How many members went to aboard for job?

54
 How much money earn from foreign employment in a year?

What is the average no of days of working in a month …….days?

If you have business which type of business is this?

How much average monthly income from business?

4. Account on Animal Production:

In your family, how many members are engaged on animal production.

How much animal average income do you receive from your animal product?

Kinds Income (in Rs.)

Selling milk/milk product/eggs

Selling goat/sheep/cattle

Total

5. Expenditure:

5. 1 Expenditure on Food Items:

Kinds Quantity Unit price (in Rs.)

Paddy/rice/maize

Milk and milk product

Cooking oil

Meat

Tea

55
5.2 Expenditure on non food:

Items Expenditure (in Rs.)

Education

Health care

Festival

Smoking

Lightening

6. How much crops do you spend in a month?

Paddy Wheat

Expenditure on livestock:

Livestock Feeding Medicine Expenditure (in Rs.)

Cow/oxen

Buffaloes

Goat/sheep

Pig/hen

Total

Production cost of different crops

Cost items Paddy Wheat Maize Vegetable Total

Seed

Fertilizer

56
Insecticides

Other

Total

7. Do you use your crops to prepare beer?

If yes then how much crops do you use?

8. What is average expenditure per month for education?

9 Do you spend for any religious function?

If yes what will be average expenditure in per day?

10. In your opinion what are the main causes of income inequality?

56