Free Essay

Sec System

In: Computers and Technology

Submitted By harshparekh2009
Words 2818
Pages 12
MUMBAI. MAY 3, 2011

SOCIO-ECONOMIC CLASSIFICATION-2011

The New SEC system

THE NEW SEC SYSTEM

What is the

new SEC system?
How do we classify

01

a household in the new SEC system?

02

What are the

advantages/ drawbacks of the new SEC system? How was the new SEC system

03

created?
What are the

04

other systems that we considered? What is

05

the performance of the new SEC system?

06 07

Conclusion
THE NEW SEC SYSTEM

01

What is the new

SEC system?

3

THE NEW SEC SYSTEM

THE NEW SEC SYSTEM

The new SEC system is used to classify households in India. It’s based on two variables:
• Education of chief earner • Number of “consumer durables” ( from a predefined

list)- owned by the family. The list has 11 items, ranging from ‘electricity connection’ and ‘agricultural land’- to cars and air conditioners We have 12 grades in the new SEC system, ranging from A1 to E3
4
THE NEW SEC SYSTEM

DISTRIBUTION OF HOUSEHOLDS

India ( urban + rural )
New SEC System

18.4
14.7 11.4 9.7 7.5 3.2 1.8 0.4 A1 A2 A3 B1 B2 C1 C2 D1 D2 E1 E2 E3 7.9 5.3 15.4

4.3

*Figures in percentage

This round of analysis has been conducted using data from IRS 2008 (round 20)*. We have drawn a sub-sample of 39,441

5

THE NEW SEC SYSTEM

DISTRIBUTION OF HOUSEHOLDS

Urban
New SEC System
12.9 11.6 10.2 7.6 5.1 8.6 13.2 12.6 9.8

4.7 2.6

1.1

A1

A2

A3

B1

B2

C1

C2

D1

D2

E1

E2

E3

Current Urban SEC system The current urban SEC system has 8 grades, and is based on occupation and education of chief earner
24 20.5 18.2 11.9 6.6 7.9 8

2.8

A1
6

A2

B1

B2

C

D

E1

E2

THE NEW SEC SYSTEM

DISTRIBUTION OF HOUSEHOLDS

Rural
New SEC System
22.2

20.1
15.6 12.8 10.7 5.1 0.04 A1 0.4 A2 1.3 A3 2.3 3.2 6.2

B1

B2

C1

C2

D1

D2

E1

E2

E3

Current Rural SEC system The current rural SEC system has 4 grades, and is based on education of chief earner and material used in construction of dwelling
40.3 43

12.3 4.3

R1
THE NEW SEC SYSTEM

R2

R3

R4
7

02

How do we classify

a household in the new SEC system?

8

THE NEW SEC SYSTEM

Just two questions
THAT NEED TO BE ASKED

SHOW CARD/READ OUT

Q1a Please take a look at this list and tell me which of these items do you have at

home? (It could be owned by you, your family, or provided by the employer or it could be available in the house you live in; but it should be for the use of just you or your family)
EXPLAIN, IF NECESSARY: We have a standard list of items that we use in all kinds of cities and villages. So don’t worry if an item appears irrelevant for you, or too ordinary- just go ahead and tell me which items you do have. We need this information just for survey purpose only.

Do you have a…(ITEM) in your home (which is in working condition)?
CIRCLE ITEMS OWNED/HAVE AT HOME. TICK THE ITEM IF OWNED. ADD THE NO. OF TICKS IN THE BOX.

Q1b

Does your family own any agricultural land, by agricultural land I mean land that is currently under cultivation or plantation?
SHOW CARD/READ OUT

Q2

Could you tell me something about the person who makes the biggest contribution to the running of the household. To what level has he studied?
RECORD IN GRID. USE GRID TO DETERMINE NEW SEC.

9

THE NEW SEC SYSTEM

RECORDING

The grid 01
Items owned / have access at home Electricity Connection Ceiling Fan LPG Stove Two Wheeler Colour TV 1a Refrigerator Washing Machine Personal Computer/ Laptop Car/Jeep/Van Air Conditioner Circle 01 02 03 04 05 06 07 08 09 10 Tick

√ √
√ √ √ √



1b

Agricultural Land NUMBER OF STANDARD 11 OWNED

11


8

10

THE NEW SEC SYSTEM

RECORDING

The grid
Chief Earner: Education (Q2)

02

No. of Durables (TRANSFER FROM Q1)

Illiterate

Literate but no formal schooling/ SchoolUpto 4 years 2
E2 E1 E1 D2 C2 C1

School- 5 to 9 years

SSC/ HSC

Some College (incl a Diploma) but not Grad 5
E2 D2 D1 C2 C1 B1

Graduate/ Post Graduate: General

Graduate/ Post Graduate: Profession al

1 None 1
E3 E2 E1 D2 D1 C2

3
E2 E1 D2 D1 C2 C1

4
E2 E1 D2 D1 C1 B2

6
E1 D2 D1 C2 B2 B1

7
D2 D2 D1 C2 B2 B1

2
3 4 5 6 7 8 9+
11 THE NEW SEC SYSTEM

C1
C1 B1 B1

B2
B1 A3 A3

B2
B1 A3 A3

B1
A3 A3 A2

A3
A3 A2 A2

A3
A2 A2 A1

A3
A2 A2 A1

03

What are

the advantages of the new SEC system?

THE NEW SEC SYSTEM

Advantages
OF THE NEW SEC SYSTEM

More discrimination as compared with current systems A single system for urban and and rural India Less subjectivity- as we no longer use occupation It’s simple - easy to answer, not very time consuming, easy

to classify

13

THE NEW SEC SYSTEM

03

Are there any

drawbacks to the new SEC system?

THE NEW SEC SYSTEM

There are no serious problems. But…

We need to be better prepared to handle minor changes to the system, because “consumer durables” penetration will change faster than education or occupation The questioning can appear intrusive to people who are unaccustomed to market research. It’s not a problem elsewhere

15

THE NEW SEC SYSTEM

04

How did we go about

creating the new system?

THE NEW SEC SYSTEM

How we created the new system

Extensive analysis based on data drawn from the IRS, made available by the MRUC- various rounds, from 2005 to 2008 Have also drawn on data from MarketPulse, IMRB’s Household panel, supplemented by a special survey

17

THE NEW SEC SYSTEM

The building blocks that were available to us
‘Demographic’ variables: e.g. occupation of chief earner, education of chief earner, education of housewife, claimed monthly household income Dwelling type and amenities: e.g. construction material, tap, bathroom, number of rooms Ownership of consumer durables

18

THE NEW SEC SYSTEM

How we arrange the blocks

‘A scoring system called LIFE; which takes into account whether a household owns or uses a wide-ranging products ranging from material of wall, roof, mode of transportation, use of toilet soap, use of ghee, biscuits, etc.
The LIFE score is used to decide the order of groups defined by two or more variables

In all we used 34 items: giving weights in inverse proportion to usage/ownership

19

THE NEW SEC SYSTEM

The basis of measuring the discrimination
We used the Lorenz curve, and the associated Gini coefficient, as a basis for measuring discrimination or inequality
We assume that the system that throws up more inequality is more discriminating. In other words, the system that shows a bigger difference in ownership/consumption between the top half and the bottom half is the better one

20

THE NEW SEC SYSTEM

05

What were the

other systems that we considered?

THE NEW SEC SYSTEM

We’ve evaluated many options

Point based system using education of highest educated individual, press exposure of housewife, and ownership of durables plus other aspects

A system based on occupation and education of chief earner and the number of consumer durables owned

A system based on and education of chief earner and the “best type” of consumer durables owned

22

THE NEW SEC SYSTEM

06

Performance of the new SEC system

THE NEW SEC SYSTEM

PENETRATION

New vs Current system (urban)
New SEC system
Have internet access at home
60 50 40 30 20 10 0 A1 A2 A3 B1 B2 C1 C2 D1 D2 E1 E2 E3 13 5 2 0 0 0 0 0 0 0 0 0 A1 A2 B1 B2 C D E1 E2 54 60 50 40 30 20 10 19 9 4 2 1 0 0 0

Current urban SEC system
Have internet access at home

Household subscribe any Newspaper
100 90 80 70 60 96 82 68 54 38 23 15 12 5 A1 A2 A3 B1 B2 C1 C2 D1 D2 2 E1 100 90 80 70 60 84

Household subscribe any Newspaper

71 56 43 30 13 10 3 A1 A2 B1 B2 C D E1 E2

50 40 30 20 10
0

50 40 30 20 3
E2 1 E3

10
0

24

THE NEW SEC SYSTEM

MRUC/Hansa Research –IRS 2008 (round 20)

PENETRATION

New vs Current system (urban) (CONTD.)
New SEC system
Receive Cable & Satellite
100 90 80 70 60 50 40 30 20 10 0 98 92 90 85 83 80 100 90 80 70 60 50 40 30 20 10 0 86

Current urban SEC system
Receive Cable & Satellite
84 80

74 49 35 16 5 1 E3

76

69 58 49 33

A1

A2

A3

B1

B2

C1

C2

D1

D2

E1

E2

A1

A2

B1

B2

C

D

E1

E2

Purchased in Past 6 Months - Ketchup / Sauces
80 70 60 50 40 30 20 10 0 A1 A2 A3 B1 B2 C1 C2 D1 D2 E1 E2 E3 37 23 19 13 9 7 5 5 2 3 53 72 80 70 60 50 40 30 20 10 0

Purchased in Past 6 Months - Ketchup / Sauces

55
40 28 19 16 9 7 5

A1

A2

B1

B2

C

D

E1

E2

25

THE NEW SEC SYSTEM

MRUC/Hansa Research –IRS 2008 (round 20)

PERFORMANCE ON DISCRIMINATION

India ( u + r )
Gini coefficients for New SEC system compared with benchmark
Penetration

Own Microwave oven
Own Internet access at home - Through PC / TV Own PC at home Own Camera (still/ digital) Housewife have read a magazine in the last 7 days Own DVD player Own Kitchen Sink Own - Mobile / Cellular Phone Own Telephone Receive Cable & Satellite

0.4 0.7 1.6 3.5 5.8 6.8 8.2 12.4 12.6

31.2 37.0

Own Pressure cooker

0
New System Benchmark System (MHI)

0.2

0.4

0.6

0.8

1

Gini Values
Data Source: MRUC/ Hansa Research - IRS 2008 (Round 20)

26

THE NEW SEC SYSTEM

PERFORMANCE ON DISCRIMINATION

India ( u + r ) (CONTD.)
Gini coefficients for New SEC system compared with benchmark
Penetration

Jam Ketchup / Sauces Chocolates Instant Noodles Floor Cleaners Toilet Cleaners Soft drinks/Fruit Juices Skin Creams/Lotions Utensil cleaners Fabric whiteners / blues Toothpaste Shampoo Bathing Soaps / Liquid Soaps

3.3 5.3 6.6 6.7 11.6 14.1 15.8 21.4 29.7 49.8 57.7 75.1 95.8

0
New System Benchmark System (MHI)
27 THE NEW SEC SYSTEM

0.2

0.4
Gini Values

0.6

0.8

1

*Purchased in the last 6 months except soft drinks, skin creams and chocolates Data Source: MRUC/ Hansa Research - IRS 2008 (Round 20) 27

GINI CO-EFFICIENTS

Urban
Gini coefficients for New SEC system compared with benchmark
Penetration

Own Microwave oven Own Internet access at home - Through PC / TV Own PC at home Own Camera (still/ digital) Housewife have read a magazine in the last 7 days Own DVD player Own Kitchen Sink Own Telephone Own - Mobile / Cellular Phone Receive Cable & Satellite Own Pressure cooker

1.0 1.9 4.5 8.5 12.7 15.7 20.9 23.8 25.9 60.0 69.6

0

0.2

0.4

0.6

0.8

1

Gini Values

New System Current System
28 THE NEW SEC SYSTEM
Data Source: MRUC/ Hansa Research - IRS 2008 (Round 20)

28

GINI CO-EFFICIENTS

Urban (CONTD.)
Gini coefficients for New SEC system compared with benchmark
Penetration

Processed Cheese/Cheese Products Jam Ketchup / Sauces Chocolates Instant Noodles Soft drinks/Fruit Juices Floor Cleaners Skin Creams/Lotions Toilet Cleaners Utensil cleaners Fabric whiteners / blues Toothpaste Shampoo

4.1 8.9 15.2 15.4

17.4
28.3 30.2 30.6 32.0 59.9 60.1 80.8 84.9

0
New System Current System
29 THE NEW SEC SYSTEM

0.2

0.4
Gini Values

0.6

0.8

1

*Purchased in the last 6 months except soft drinks, skin creams and chocolates
Data Source: MRUC/ Hansa Research - IRS 2008 (Round 20) 29

GINI CO-EFFICIENTS

Rural
Gini coefficients for New SEC system compared with benchmark
Penetration

Own Microwave oven Own Internet access at home - Through PC / TV Own PC at home Own Camera (still/ digital) Own Kitchen Sink Housewife have read a magazine in the last 7 days Own DVD player Own - Mobile / Cellular Phone Own Telephone Rural Assets - Table Fan Receive Cable & Satellite Own Pressure cooker Rural Assets - In-house toilet

0.1 0.1 0.3 1.3 2.7 2.8 2.8 6.6 7.6 13.4 18.6 22.8 30.9

0
New System Current System
30 THE NEW SEC SYSTEM

0.2

0.4
Gini Values

0.6

0.8

1

Data Source: MRUC/ Hansa Research - IRS 2008 (Round 20)

30

GINI CO-EFFICIENTS

Rural (CONTD.)
Gini coefficients for New SEC system compared with benchmark
Penetration

Instant Noodles Chocolates Floor Cleaners Toilet Cleaners Soft drinks/Fruit Juices Utensil cleaners Skin Creams/Lotions Fabric whiteners / blues Toothpaste Shampoo Biscuits

2.1

2.8
3.5 6.2

10.4
16.5 17.4 45.3 47.6

70.8
73.2

0

0.2

0.4

0.6

0.8

1

Gini Values

New System Current System
31 THE NEW SEC SYSTEM

*Purchased in the last 6 months except soft drinks, skin creams and chocolates Data Source: MRUC/ Hansa Research - IRS 2008 (Round 20)

PERFORMANCE ON DISCRIMINATION

Conclusion

The new SEC system is better than the current urban system , and much better than the current rural system

32

THE NEW SEC SYSTEM

PERFORMANCE OF THE SYSTEM

Homogeneity within the grade : India (u + r)
MHI System
Level Distribution of Households % Median LIFE Inter Quartile Range (IQR) Level

New SEC System
Distribution of Households % Median LIFE Inter Quartile Range (IQR)

1
2 3 4

0.5 1.5 4.2 3.5

702 618 514 455

186 236 243 236

A1
A2 A3 B1 B2 C1 C2 D1 D2 E1 E2 E3

0.4
1.8 3.2 4.3 5.3 7.5 7.9 11.4 14.7 18.4 15.4 9.7

804
687 590 494 430 369 319 270 222 164 117 80

116
150 173 172 164 142 124 117 106 90 75 65

5
6 7 8 9 10 11 12

4.7
7.1 11.7 19.3 19.2 13.5 12.9 2.1

391
347 289 232 181 136 125 95

227
207 178 155 139 110 111 101

THE NEW SEC SYSTEM

Median LIFE (Urban + Rural): 220

PERFORMANCE OF THE SYSTEM

Homogeneity within the grade : Urban India
Current SEC System
Level Distribution of Households % Median LIFE Inter Quartile Range (IQR) Level

New SEC System
Distribution of Households % Median LIFE Inter Quartile Range (IQR)

SEC A1 SEC A2 SEC B1 SEC B2 SEC C SEC D SEC E1 SEC E2

2.8 6.6 7.9 8.0 20.5 24.0 11.9 18.2

702 616 539 467 408 320 280 212

189 225 215 221 210 167 155 137

A1 A2 A3 B1 B2 C1 C2 D1 D2 E1 E2 E3

1.1 5.1 7.6 8.6 10.2 12.9 11.6 13.2 12.6 9.8 4.7 2.6

807 704 610 532 463 399 347 300 251 194 148 112

106 132 147 158 158 136 118 113 100 92 93 80

34

THE NEW SEC SYSTEM

Median LIFE (Urban India): 354

PERFORMANCE ON HOMOGENEITY

Conclusion

The new SEC system is able to reduce heterogeneity within social grade- and stretch the differences by grade

35

THE NEW SEC SYSTEM

07

Conclusion
THE NEW SEC SYSTEM

In Conclusion
We have a system that is simple, easy to administer. It gives us good discrimination; the social grades created are more homogenous But we do need to revisit the system at least once every two years; and make sure that when a change is needed, this is a smooth process It’s easy to begin using the new system. For those who need to keep track of the old SEC for reasons of comparability, the new system means just one more question- which can be tagged on right at the end.
37 THE NEW SEC SYSTEM

Thank You

38

THE NEW SEC SYSTEM

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