The Pakistan Development Review
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Employers Size Wage Differential: Does Investment in Human Capital Matter?
Get PDFWage differential due to employer size is one of the key areas
of interest in labour market research because a strong positive
relationship between employer size and wages has been observed in
developed and developing countries. It is, however, relatively neglected
area of research in Pakistan. The purpose of present study is to
investigate the employer size wage differential by looking at human
capital factors. The study is based on standard methodology and
estimates earning functions on Labour Force Survey (LFS) data for year
2007-08. Results clearly show that human capital investment has a bigger
role in determining wages in the larger firms as compared to smaller
firms. The main policy implications emanating from the analysis are the
higher investment in skill which increases opportunities for workers in
the labour market for higher wages and for jobs with good
characteristics especially in large sized firms. The government policy
towards education and skill formation needs serious reforms and better
allocation of funds so that people get chance to enhance their skill
level hence wages. JEL classification: J31, J40, J24 Keywords: Wage
Differential, Human Capital, Labour Marke
The Ultimatum Game and Gender Effect: Experimental Evidence from Pakistan
Get PDFLaboratory experimentation was once considered impossible or
irrelevant in economics. Recently, however, economic science has gone
through a real ‘laboratory revolution’, and experimental economics is
now a most lively subfield of the discipline. This study attempts to
examine answers to questions of the changing behaviour of opposite sexes
under conditions of both anonymity and knowledge of gender by playing
the ultimatum game in Pakistan. It is observed that the behaviour of
males and females in Pakistani society is quite different from that
found in earlier studies. Insights from the previous experiments have
already shown that normative economic theory had failed in its
predictions of human behaviour. Currently, the ultimatum game is widely
discussed in behavioural economic literature, and this paper will adjust
the traditional ultimatum game into a new form wherein it will be tested
in the country (Pakistan) with multidimensional behaviour of subjects.
With regard to gender effect specifically, all previous studies came up
with somewhat mixed results, since results do not always point in the
same direction and it is rather early to draw far-reaching conclusions
regarding the behavioural differences of men and women. More facts are
required in order to move towards the development of a systematic
theory. This work is a small attempt to investigate the changing
behaviour of opposite sexes under different controlled
conditions
Resolving the Kashmir Dispute: Blending Realism with Justice.
Get PDFThe resumption of India-Pakistan peace dialogue after a hiatus
of nearly eighteen months resulting from the Mumbai terrorist attacks,
has revived interest in different formulas, proposals and options that
have been made from time to time to resolve the Kashmir dispute, the
root-cause of “unending conflict” between the two nuclear-armed
neighbours. This paper attempts to make a contribution towards this
ongoing exploration of feasible ideas by highlighting the relevance of
the Difference Principle expounded by John Rawls in his Theory of
Justice as a key component of a lasting India-Pakistan peace deal on
Kashmir. The paper begins with a brief account of the historical
background of the Kashmir dispute, its evolution and a summary of the
competing Indian and Pakistani claims to the disputed territory. Section
two of the paper provides a descriptive account of the various solutions
that have been proposed and the attempts made by India and Pakistan to
resolve the Kashmir dispute. The last section of the paper offers a
summary of the main tenets of Rawls’s theory of Justice and examines the
relevance of the Difference Principle as a guide to finding a just
resolution of the Kashmir dispute
Shahid Javed Burki. Changing Perceptions, Altered Reality: Pakistan’s Economy under Musharraf, 1999-2006. Karachi: Oxford University Press, 2007. 373 pages. Hardbound. Price not given.
Get PDFThis book is another addition to Shahid Javed Burki’s work
whose writings have been pivotal for understanding Pakistan’s social and
economic transitions. The book examines various sectors of the economy
that could become the source for sustainable growth. Thoughtful public
policies in the high-potential areas are suggested with the claim that
these could help the country join the ranks of Asia’s rapidly growing
economies. Based on the weekly columns by the author published in the
daily DAWN, and focusing on the 1999-2006 period, the tenure of
President Pervez Musharraf, the book analyses the economic and social
problems faced by Pakistan. It then discusses the opportunities that
exist for the country in light of its geographical situation, and the
rapid changes in the structure of the global economy. The issues
explored in the book include the reasons for the rapid growth of the
economy from 2003 onwards, as well as its impact on poverty and income
distribution. It is suggested that these high rates of growth would not
be sustained into the future unless a number of changes in the structure
of the economy were introduced. The book consists of eight chapters. The
first chapter starts with a brief discussion of the country’s economic
history as well as the situation in mid 2000 (associated with high
growth rates). It then continues to analyse the factors responsible for
such growth with the caution that the economy still needs more measures
before labeling it to have been set on a course of a high level of
sustainable growth. In this regard the obstacles particularly related to
infrastructure and governance are discussed raising crucial points and
suggesting suitable measures. The chapter identifies various areas that
need urgent attention by the policy-makers advising them to understand
the true nature of the ‘determinants of growth’ and how they will affect
the incidence of poverty and equality of opportunity
Education Order in Punjab: A District Level Study.
Get PDFThis paper attempts to evaluate the status of education in the
current districts of Punjab and compare this with the status of
education attainment in 1998. The tool used for assessment and
comparison is the Education Index (EI) for the districts of Punjab. The
Education Index is a composite index which is calculated using
enrollment at different education levels and literacy rates. The main
data sources used are the Population Census 1998, Punjab Development
Statistics 1998 and the Multiple Indicator Cluster Survey (MICS) 2008.
Using data from these sources, robustness in the results is verified by
comparing different weighting simulations of the EI. The EI results are
found using the UNDP methodology and the Principal Component Analysis
(PCA) method. Both methodologies of calculation lead us to ascertain the
robustness of the EI calculation using the data. This testing allows an
important conclusion to emerge that the different weighting schemes does
not largely affect the ranking of districts. Further, by comparing the
results for both years, considerable development in education status is
observed; however, an unexpected result also appears. The relative
pattern of education status across Punjab has hardly altered in the last
ten years even with the considerable progress that has been witnessed.
This shows that an unchanging relative ranking of districts seems to
exist unless significant endorsement of education takes place within the
lowest ranked districts. JEL classification: I2, O1 Keywords: Education,
Development, Developing Countr
S. S. Khanka. Human Resource Management: (Text and Cases). New Delhi: S. Chand & Company Ltd. 2007. 449 pages. Paperback. Indian Rs 300.00.
Get PDFHuman Resource Management (HRM) is a process of procuring,
developing, maintaining and controlling competent human resource in the
organisation so that the organisational goals are achieved in an
effective manner. HRM has undergone tremendous change in its functions
over the past 20-30 years. Many years ago, large organisations looked at
the “Personnel Department,” mostly to manage the paperwork around hiring
and paying people. But more recently, organisations consider the major
role of HR Department as staffing, training and helping to manage people
so that people and the organisation perform at the highest level of
their capacity. The modern HRM views manpower as resource and asset of
the organisation rather than just considering it burden on the
resources. Usually large national and international businesses utilise
these services due to their multidimensional operations and sizable
employment. Small businesses carry out these activities by themselves to
save cost associated with full-or part time help. However, they
generally ensure that employees have—and are aware of— personnel
policies conform to prevailing regulations. These policies are developed
by the HRM professionals in the form of employee manuals and
handbooks
Competitiveness among Asian Exporters in the World Rice Market.
Get PDFWith the gradual reduction in trade barriers led by the
process of globalisation, more emphasis is now being placed on promoting
export competitiveness. Asia is the home of many of the world’s top rice
exporters. The food-price crisis has divided Asia into “rice haves” and
“rice have-nots”. In order to describe the processes involved in
securing and maintaining international competitiveness in rice exports,
the present study has used the Balassa and White indices of revealed
comparative advantage and revealed competitive advantage respectively.
Results have revealed that Pakistan is the most competitive country in
rice trade and ranks first in both agricultural product trade and total
merchandise exports. JEL classification: C12, C43, Q17 Keywords: Asian
Countries, Competitiveness, Revealed Comparative Advantage, Revealed
Competitive Advantage
Regional Health Accounts for Pakistan—Provincial and District Health Expenditures and the Degree of Districts Fiscal Autonomy on Health.
Get PDFSince May 2009 the first National Health Accounts (NHA) for
Pakistan have been finalised and published by Federal Bureau of
Statistics (FBS) in cooperation with German Technical Cooperation (GTZ).
This paper goes one step ahead the report and analyses in more detail
the regional differences in health expenditure structures in Pakistan.
The further analyses can be divided into four parts: health expenditures
in provinces (Provincial Health Accounts, PHA),2 Punjab provincial and
district governments health expenditures and its comparison with ADB
figures, all districts of Pakistan and comparison between total district
government and provincial government expenditure for each province; the
latter calculation is applied as indication for the degree of fiscal
autonomy of the districts in each province. Consequently we first
analyse the provincial health expenditures by Financial Agents and
compare them between the provinces which leads to very heterogeneous
results (Section 2); the per capita health expenditures differ from 16
to 23 USD. Secondly, we compare NHA results on Punjab district
government with available ADB results and present differences in methods
as possible reasons for different results (Section 3). Third, we analyse
district data of all district governments in all four Pakistani
provinces on the level of detailed function codes in Section 4; the aim
is to discover regional differences between districts of the same as
well as of different provinces. Fourth, we analyse in Section 5 the
degree of fiscal autonomy on health of the districts in each province;
therefore we review the ordinance description and compare total district
government with total provincial government expenditures per province.
Finally we give recommendations for future rounds of NHA in Pakistan
regarding formats and necessities of detailed health expenditure data
collection to ensure evidence based decision-making not only on federal,
but also on provincial and district level. JEL classification: H51, I1,
O18, R1 Keywords: National Health Accounts, Health Expenditures,
Regional Comparison, Regional Accounts, Fiscal Autonomy,
Pakista
Dynamic Effects of Changes in Government Spending in Pakistan’s Economy.
Get PDFThis study analyses the effects of changes in government
spending on aggregate economic activity and the way these effects are
transmitted in case of Pakistan for the period 1971-2008. To analyse the
transmission mechanism of government spending innovations, the Vector
Autoregressive Model is estimated for following five variables:
government spending per capita, GDP per capita, consumption per capita,
debt to GDP ratio, long term interest rate and real exchange rate. The
consumption and output respond negatively to the innovation in
government spending which is consistent with the standard neoclassical
model. The interest rates increase in the face of expansionary fiscal
spending. As government debt builds up with fiscal expansion, the rising
risk of default or increasing inflation risk reinforce crowding out
through interest rates. The real exchange rate tends to appreciate in
response to rise in government spending. This finding is according to
the open economy literature and also with the conventional literature.
JEL classification: E21, E62, E63 Keywords: Government Spending, Vector
Autoregressive Model, Impulse Response Function, Neoclassical
Mode
Wastewater Use in Cauliflower Production and Farmer’s Health: An Economic Analysis
Get PDFThe present study aims to estimate the economic values of
negative externalities of wastewater use in cauliflower production.
Cost-benefit analysis is employed to estimate the farmer’s health
externalities in the production sector. The data are collected from 200
farmers (100 from each group, wastewater and freshwater) in the year
2006 from two peri-urban villages of Faisalabad city. Ignoring the value
of negative externalities, wastewater use is profitable in vegetable
production but when the economic value of negative externalities are
factored in the analysis, the results strongly discourage its use. The
cost of health externalities due to wastewater use in cauliflower
production (only for a three-month crop) is Rs 3.2 million from the 741
acres planted. In Faisalabad, 5,283 acres of vegetables are cultivated
using wastewater, and the value of total negative health externalities
amounts to Rs 90.7 million in a year. A huge economic loss due to
wastewater use may attract the attention of policy agents to intervene.
Among different available options, installation of a water treatment
plant appears to be most viable to minimise the external effect of
wastewater use in peri-urban agriculture