Shedding Light on Regional Growth and Convergence in India

Abstract A large body of research on India’s rapid economic growth since 1991 also documents increasing regional disparities. In this paper, we use unsaturated night light data to challenge this dominant narrative of unequal growth. For 520 districts spanning a 15 year period (1996–2010), we find overwhelming evidence of absolute convergence. Dividing districts further into rural and urban areas, we also show that this catching-up can be attributed mainly to faster growth in rural areas. Geographically disadvantaged districts - those further away from the coast, with lower agricultural suitability, and more rugged terrain also grew faster. The convergence results are not associated with major infrastructure and education initiatives that overlapped with the period of analysis, and also hold for alternative measures of night-lights that cover a longer period of time (1992–2013).