The aim of this study was to investigate the potential linkages between access to water and sanitation with household wellbeing in India. A few studies have been carried out on the expected benefits of investments in water and sanitation in spite of the fact that effect of investment in water and sanitation has a huge impact on overall performance of household in terms of health, education, employment, etc. This study uses data from Indian Human Development Surveys (IHDSs) collected by the University of Maryland and the National Council of Applied Economic Research in 2004–05 and 2011–12. Econometric analysis has been done to examine the relationship between access to water and sanitation and its consequential impact on the overall welfare of households. The main hypothesis is that an improvement in the accessibility of water and sanitation sources increases the overall standard of living with the assumptions that an improvement in the accessibility of water and sanitation sources reduces illness among household members, which also, in turn, tends to increase overall standard of living. The data indicated that there was no significant improvement in access to water sources in India from 2004–05 to 2011–12. Around 53% of the households surveyed used open fields as toilets in 2004–05, and this proportion only slightly decreased (44.72%) by 2011–12. While comparing the overall standard of living, about 38.5% respondents believe they became better off between two periods (from 2004–05 to 2011–12) while around 52% respondent feels there was no significant improvement in their standard of living. Ordered log it regression analyses were carried out to establish links between water and sanitation access and changes in household welfare. There is a positive relationship between improvements in households ’sources of water and sanitation and improvements in households ’(self-reported) overall welfare. In other words, households experiencing an improvement in their source of water supply and sanitation were more likely to report an improvement in their overall standard of living, and less likely to report deterioration.

Abstract

In view of formulating credible monetary policy to attain the price stability objective, the difficult part for the central banks is to distinguish, within ongoing inflation evolutions, between short term volatility and the underlying pressure of inflation. While it has now become a standard practice for most central banks around the world to monitor core inflation, little progress has so far been made in the Indian context. This paper takes a pioneering look in measuring core inflation in India focusing on the popular exclusion and trimmed mean approaches. The performance criteria adopted in this analysis show that the measure of core inflation developed in the paper has strong money-induced characteristics and therefore, can credibly be used as a short or medium term guide of monetary policy in India. This paper aims to introduce the concept of core inflation and to calculate alternative measures of core inflation for India. We have used two approaches: (1) Exclusion based approach (2) Trimmed mean method, to identify the measures of core inflation. We have obtained five alternative measures of core inflation using exclusion approach these are: WPI excluding food articles, WPI excluding food articles and non food articles, WPI excluding food articles and fuel (minerals oils), WPI excluding fuel (minerals oils) and manufactured products (Beverages, Tobacco and Tobacco Products, Non-Metallic Mineral Products, Basic Metals Alloys and Metals Products), WPI excluding Minerals, Basic Metals Alloys and Metals Products, Minerals Oils, Non-Metallic Mineral Products, Beverages, Tobacco and Tobacco Products., two measures TRIM15_15 and TRIM20_20 using trimmed mean For this we have evaluated these measures of core inflation in India based on new series of WPI (1993–94 =100). These measures were tested for volatility and unbiasedness and co- integration with headline inflation. The co-integration test statistics confirm long run relationship between the core inflation measures and headline inflation. The study found that the exclusion based measures are more appropriate for inflation targeting purposes and the measures based on the trimming may be better for identifying the underlying trends and also in providing a robust forecast of future inflation rates in India.