Causes of Inequality in Nepal

Inequality prevails in both social and economic activities. Actual farmers have no land, so, the
owners get the main outcome of agriculture. There is inequality even in profit and wages distribution. But
it creates competition and is relative. Inequality is created when GNI is not distributed in a vindicate way.
Gini coefficient is used to measure inequality which lies between 0 to 1. 0 represents maximal equality
whereas 1 represents maximal inequality. If it is up to 30%, it’s positive. The country’s economy is
supposed to be in control of some rich people if its 30%-50% and the condition is devastating if it is above
50%.

Around 25% population of Nepal is below the poverty line. 20% of the poorest people possess only
9% of national property whereas 20% of the richest have 55% of it. Gini coefficient of 47%, near to 50%
explains that devastating condition may arise. Unequal distribution of land and unmanaged politics are
the main cause of inequality in Nepal. Proper use of budget on development projects by local bodies can
lower inequality but it has not been done.

Submitted By: Sudarshan Gautam

Roll No.: 26

MA Economics, 1st Semester