The Efficient Market Hypothesis is alive and well, I am glad to report. At least when it comes to writing rebuttals. I will not get into the controversy at all in this post, but I do need to establish the context for what I will be writing about today.
Shamika Ravi wrote a column about what are, in her opinion, problematic national surveys in our country:
Using projected population estimates, we find that nearly all major surveys in India that were conducted post-2011 and used the Census 2011 for the sampling frame have overestimated the proportion of the rural population significantly. This is one of the several problems with data quality, but it is a critical concern — and appropriately highlights the problem at hand.
https://indianexpress.com/article/opinion/columns/shamika-ravi-writes-our-national-surveys-are-based-on-faulty-sampling-8799300/
I am but one of many who happen to disagree with many of the points raised in this column. But that’s not what I want to write about in today’s post. Pronab Sen wrote a column in response, and this post is about a particular point in his column. But first, a key excerpt from Sen’s column:
The Census measures urban population in two categories — (a) statutory towns/cities; and (b) Census towns. Statutory towns/cities are entities which are legally recognised as urban areas by the concerned state governments and are governed by municipalities/nagar palikas. Census towns, on the other hand, are legally rural areas, that is, coming under panchayats, which exhibit characteristics of urban agglomerates on three counts — size of the population, population density and proportion of the male workforce not engaged in agriculture. It so happens that in Census 2011, a major part of the rapid urbanisation that Ravi talks about occurred in Census towns and not in the statutory urban areas.
https://indianexpress.com/article/opinion/columns/criticism-of-sample-surveys-is-misplaced-their-data-differ-from-census-count-because-definitions-are-different-8822347/
The surveys, on the other hand, follow only the statutory definition while classifying rural and urban areas. Thus, although all surveys use the Census as the sampling frame, Census towns are treated as a part of the rural sector and are included in the rural sample. Therefore, practically all the discrepancy that Ravi makes so much of is simply the outcome of differences in the definition of urban areas in the Census and the surveys.
Read both essays in their entirety to get a sense of what the debate is about, but for the purpose of today’s post let’s focus on census towns. As Pronab Sen mentions, census towns are “legally rural areas” – but they “exhibit characteristics of urban agglomerates”. What characteristics? Three, per Sen: size of the population, population density and proportion of the male workforce not engaged in agriculture.
Well ok, you might say, but what values do these variables need to have for an urban agglomeration to be considered a “census town”?
The Census definition identifies urban settlements as either areas already governed by ULBs or areas having a population greater than 5,000, a density over 400 people per square kilometre, and 75% of the male working population employed in non-agricultural activities. By this definition, India is 31% urban.
https://www.idfcinstitute.org/site/assets/files/15116/reforming_urban_india_idfc_institute.pdf
Areas that satisfy these criteria but are not already governed by ULBs are known as Census Towns (CTs).
When was this definition framed? In, er, 1961. And nope, it hasn’t been updated since. But defining what is an “urban agglomeration” and what isn’t is quite tricky. Consider this chart, for example:
As the article from which I sourced this chart says, “while experts may disagree on the precise definition of ‘urban’, they all agree that it makes sense to view the entire spectrum of settlements—from small villages to large urban agglomerations—as a continuum rather than in terms of the rural/urban binary”
And by the way, the same definition of urban agglomeration will apply to the 2021 Census. In, in fact, you read the PDF, all rural units having a population of 4000 or more at the preceding census (2011) will be examined, as they will almost certainly have crossed the 5000 mark in 2021. This, of course, is the point that Pronab Sen is making in his report. Since these will likely be the best performing parts of hitherto “rural” India, classifying them as urban here on in will make rural India look far worse.
OK, but why does all of this matter all that much, eh? Census towns, in particular – what’s the big deal? Well, here’s why it matters:
Census Towns continue to be governed by panchayats despite having the density of urban areas. Rural Local Bodies (RLBs) and ULBs were designed to cater to the varying governance needs of rural and urban areas. The 73rd and 74th Constitutional Amendment Acts specify different powers and functions for the
https://www.idfcinstitute.org/site/assets/files/15116/reforming_urban_india_idfc_institute.pdf (pg. 14)
two bodies. For instance, as seen in Figure 2, ULBs are mandated to provide water for residential, industrial, and commercial purposes, while RLBs are mandated to provide only safe drinking water. This means that industrial or commercial units in de facto urban areas may find it harder to access adequate water compared to those in areas governed by ULBs. Panchayats are not required to provide many of the other basic services required of dense urban living, for example, sewerage lines, fire services, and building code regulations. Therefore Census Towns remain grossly underserved. As of the 2011 Census, 55 million people – the population of South Africa – lived in them.
Here’s Fig.2 from that same report:
Defining urbanization is a tricky endeavor at the best of times in any country. Doing so for India comes with its own unique set of challenges. But when the definition may have an impact on the answer to the question of how well India has done in the recent past, well, that’s a whole other problem, and it’s not only restricted to economics.
But hey, now you know what a census town is. There’s that.
EconForEverybody 