Shedding light on regional growth and convergence in India.

• The paper uses unsaturated night light data to investigate convergence within India over a 15 year period, 1996–2010. • Unlike the widely held view that regional disparities are increasing, we find absolute convergence at the district level. • This convergence happens mainly due to faster catchup in poorer (less well lit) rural areas. Urban Convergence is slower. • Districts that ranked lower in geographical advantages also grew faster during this period. • The results hold even after controlling for major policy initiatives that overlapped this period. 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). [ABSTRACT FROM AUTHOR]