The Pakistan Development Review
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Does Economic Geography Matter for Pakistan? A Spatial Exploratory Analysis of Income and Education Inequalities.
Get PDFGenerally, econometric studies on socio-economic inequalities
consider regions as independent entities, ignoring the likely
possibility of spatial interaction between them. This interaction may
cause spatial dependency or clustering, which is referred to as spatial
autocorrelation. This paper analyses for the first time, the spatial
clustering of income, income inequality, education, human development,
and growth by employing spatial exploratory data analysis (ESDA)
techniques to data on 98 Pakistani districts. By detecting outliers and
clusters, ESDA allows policy makers to focus on the geography of
socio-economic regional characteristics. Global and local measures of
spatial autocorrelation have been computed using the Moran‘s I and the
Geary‘s C index to obtain estimates of the spatial autocorrelation of
spatial disparities across districts. The overall finding is that the
distribution of district wise income inequality, income, education
attainment, growth, and development levels, exhibits a significant
tendency for socio-economic inequalities and human development levels to
cluster in Pakistan (i.e. the presence of spatial autocorrelation is
confirmed). Keywords: Pakistan, Spatial Effects, Spatial Exploratory
Analysis, Spatial Disparities, Income Inequality, Education Inequality,
Spatial Autocorrelatio
Formal Participation in a Milk Supply Chain and Technical Inefficiency of Smallholder Dairy Farms in Pakistan
Get PDFThis paper provides empirical evidence on the impact on
technical inefficiency of smallholder dairy producers when they formally
participate in a milk supply chain. Here the stochastic production
frontier and technical inefficiency effects model are estimated based on
the data gathered from 800 smallholder dairy farms in Pakistan. The
results suggest that the technical inefficiency of the participating
farms is significantly reduced. A strong impact of the supply chain is
also detected in reducing technical inefficiency of farms that are
located in remote areas and on those that have larger herd-size.
Experienced farmers upto the age of 36 years have the advantage of
reducing technical inefficiency. The remaining differences in relative
inefficiency of dairy farms are accounted for by severe long-term
depressive disorders. JEL classification: D24, Q12, Q13, Q18 Keywords:
Agri-food Supply Chain, Production Frontiers, Dairy Efficiency, Food
Policy, Pakista
Is Consumption Pattern Homogeneous in Pakistan? Evidence from PSLM 2007-08.
Get PDFThis study has analysed consumption behaviour of households
across the four provinces of Pakistan using recent household survey data
of 2007-08. It is found that the consumption patterns are not entirely
homogeneous across all 4 provinces and also diverge across the
urban-rural sectors within each province. The study has also examined
the role of remittances in determining the level and distribution of
household consumption expenditures, across all four provinces, by
comparing the consumption behaviour of those households who received
remittances versus those who did not. We found that households receiving
remittances spent proportionately more on education in all provinces
except Balochistan; while they spent proportionately less on food and
drinks and transport and communication. In terms of the other
expenditure categories, differential impact of remittances is observed
across provinces
Policy of Inflation Targeting in the Presence of Fiscal Deficit and External Debt: Opt or Not to Opt.
Get PDFThe main task of the macroeconomic policy-makers is to control
unemployment and inflation at the minimum possible level. Different
policies have been tried to control inflation at its minimum possible
level and inflation targeting is the most popular among them. It is the
commitment to maintain inflation at the announced level and use interest
rate as an instrument to control it if it is expected to diverge from
the announced level. However in a higher \dollar denominated debt.
country Central Bank is reluctant to increase interest rate because it
pressurises the foreign exchange market, which leads to exchange rate
depreciation. If there is exchange rate pass through effect to prices,
depreciation leads to increase in prices. Thus increase in interest rate
does not decrease prices instead results in increase in prices. The two
important linkages were tested in this study are (i) increase in real
interest rate depreciates the currency, and (ii) depreciation in real
exchange rate leads to increase in prices. Using VAR model we concluded
that real exchange rate is not significantly associated to the real
interest rate in the short run and exchange rate pass through effect to
prices is not present in Pakistan
Dynamic Relationship Between Energy and Economic Growth: Evidence from D8 Countries.
Get PDFEnergy sector has a vital influence on an economy, on both
demand and supply sides. Therefore, energy production and consumption
bear great importance for the developing world. The oil embargo of
1970‘s and its impact on major macroeconomic variables throughout the
world attracted many economists to examine the relationship between
energy and economic prosperity. The researchers have been unable to
establish a definitive direction of causality between the two variables.
The purpose of this study is to empirically investigate the dynamic
relationship between energy use and economic growth in the D8 countries.
The evidence gathered through application of VAR Granger Causality,
Johansen Cointegration and VECM proves existence of short-run and
long-run correlation between energy use and economic development in all
countries. The results supported either uni-directional or
bi-directional causality in the D8 countries except for Indonesia in
short-run where non-causality was established between the two variables.
JEL classifications: C22; Q43. Keywords: Energy Use, Economic Growth,
D8, VAR Granger Causality, Cointegration, VEC
Bashir Ahmad Khilji. Sixty Years of Human Resource Development in Pakistan. Government of Pakistan, Higher Education Commission, Pakistan. Islamabad: HEC Printing Press. 2011. 283 pages. Price not given.
Get PDFHuman resource development (HRD) occupies a central position
in the advancement of a society. It is obvious from the historical
experience of industrialised countries that developing human capacity is
essential for a self-reliant and self-sustaining pattern of growth.
Almost all Asian countries, including Pakistan, continue to search for
additional appropriate strategies to respond to the rapid changes in the
global economy. Unfortunately, despite registering a satisfactory rate
of economic growth, Pakistan’s progress on the human front lags behind
in terms of key indicators such as literacy, primary-level participation
rate, basic health facilities, population welfare, water and sanitation,
etc. Pakistan ranked 145th out of 179 countries in the world on the
human development index in 2011
Asset Pricing Behaviour with Dual-Beta in Case of Pakistani Stock Market
Get PDFThis study investigates the dynamics of beta by the asymmetric
response of beta to bullish and bearish market environment on 50 stocks
traded in Karachi Stock Exchange during 1993-2007. The results show that
the betas increase (decrease) when the market is bullish (bearish). The
results however suggest that investors receive a positive premium for
accepting down-side risk, while a negative premium is associated with
up-market beta. The results suggest that the conditional Fama and French
three factor model has performed better than the conditional CAPM when
news asymmetry was taken into account compared with the unconditional
Fama and French three factor model and the unconditional dual-beta CAPM
in explaining the relationship in beta and returns in case of Pakistani
market. JEL classification: G12, G15 Keywords: Beta Instability, High
Market Beta, Low Market Beta, EGARCH Model, News Asymmetry, Fama and
French Three Factor Mode
The Role of Global Economic Growth in Pakistani Agri-Food Exports
Get PDFThis analysis uses least squares and Heckman maximum
likelihood estimation procedures with fixed effects to explore the role
of economic growth in 36 developed and developing economies—categorised
as low-, lower-middle-, upper-middle-, and high-income—in explaining
their agri-food import of 29 products from Pakistan during 1990 to 2000.
We reject the hypothesis that the economic growth of these economies
does not influence Pakistani agri-food product exports. However, the
estimated income elasticities are statistically elastic only for
lower-middle income countries, suggesting that their expenditure on
Pakistani agri-food exports will increase disproportionately as their
economies grow. Hence, lower-middle-income countries provide good export
opportunities for Pakistan’s agri-food products. JEL Classifications:
F14, Q17 Keywords: Economic Growth, Agri-food Trade, Income
Elasticities, Developing Countrie
A Global Green New Deal for Economic Recovery: Addressing the Financial, Climate, Food, Jobs and Development Crises Together? (The Allama Iqbal Lecture)
No full textThese immortal lines from Allama Iqbal make me very humble
standing before you today to deliver the Allama Iqbal lecture. Mr
Chairman, Mr President, Excellencies, ladies and gentlemen, friends
all,. thank you very much for this honour and opportunity to speak to
you on a very difficult subject. I would like to emphasise that, thanks
to Professor Naqvi, this is not the first time I am appearing before the
Pakistan Society of Development Economists, but it certainly is the
first time, thanks to Dr Rashid Amjad, I have been invited to give this
very distinguished lecture. Both men are very distinguished in their own
right; they are people whom I have greatly respected over the years.
Professor Naqvi's contributions, particularly on ethics and economics,
and the challenge of rethinking Islam reminds me of Allama Iqbal's
Reconstruction of Islamic Thought and the relevance of it for the
challenges facing the world today, as highlighted by Professor Saith's
lecture yesterday. The lines from Iqbal that I began with are very
relevant, of course, to the whole question of inequality. I met Dr
Rashid Amjad about three decades ago in the context of his work at the
ILO. Over the decades, he provided sterling leadership in very different
and changing circumstances. In a sense, it is his absence from the ILO
today that is particularly felt because we face a very unique situation
in the world today where, unfortunately, various forces seem to have
successfully conspired to prevent a strong economic recovery. This is
the subject of the lecture I would like to deliver
The Integration of Financial Markets in GCC Countries
Get PDFThe real interest parity (RIP) condition states that the
interest rate differential between two economies is equivalent to the
differential between the forward exchange rate and the spot exchange
rate. This study examines the integration of financial markets in the
GCC countries by verifying the validity of RIP in their economies. Using
univariate and different panel unit root tests, we find evidence
supporting the RIP theory, which indicates that the financial markets in
these countries are well integrated and that the adoption of a common
currency would be relatively easy. JEL classification: F21; F36; C23
Keywords: Real Interest Parity, GCC Countries, Panel Unit Root Tests,
Monetary Unio