IMPACT OF POOR GOVERNANCE AND INCOME INEQUALITY ON POVERTY IN PAKISTAN

1841 Words4 Pages
bulb-icon

Recommended: Role of government in poverty reduction

There is widespread poverty in Pakistan and the two main reasons are poor governance and income inequality. Few studies have focused on the theoretical substantiation of impact of bad governance and income inequality on poverty, but we do not find any study carrying empirical work on the impact of bad governance on poverty in Pakistan. This study is an empirical research that attempts to find out the long run and short run impact of poor governance and inequality in wealth and income distribution on poverty in Pakistan through time series analysis from the year 1984 to 2008. Autoregressive Distributive Lag (ARDL) Approach to Co integration is applied in order to find out the short run and long run relationship between the variables. Co integration between poverty, poor governance and income inequality is found in the present study. The results of this study also confirm the positive relationship between poverty and income inequality both in short and long run. Poor governance is found to positively affect poverty in the long run, but in the short run it does not have significant impact on poverty in Pakistan. CUSUM and CUSUMQ stability tests are employed on the model and the results show there is a stable relationship between the variables indicating stability of the estimated model.

Keywords: Poverty, Poor Governance, Income Inequality, ARDL

On 17th June 2010 three men committed suicide in Rajana, Lahore, and Ghakhar Mandi because of poverty. As reported by police, Nadeem, a 28 years old man took his life in Lahore due to his failure to pay off debt of Rs. 800,000. In the next happening, Ismail a 22 year old man killed himself by consuming poisonous pills because of poverty, in Rajana tehsil. In the third incident in Gha...

... middle of paper ...

...esh”. Working Paper No 143. Research Program on: Good Governance and Poverty Alleviation by OECD Development Center.

Sumarto, S., A. Suryahadi and A. Arifianto (2004), “Governance and Poverty Reduction: Evidence from Newly Decentralized Indonesia”. A paper from SMERU Research Institute.

The News International. Retrieved on June 18, 2010, from http://beta.thenews.com.pk/TodaysPrintDetail.aspx?ID=29537&Cat=13&dt=6/18/2010

The QoG Social Policy Dataset Codebook .Retrieved from http://www.qog.pol.gu.se/data/QoG_Codebook_vJune09.pdf

Van der Hoeven, R. (2000), “Poverty and Structural Adjustment: Some Remarks on Tradeoffs between Equity and Growth”. Employment Paper 2000/4.Geneva: ILO Publications

World Bank (2002) Poverty in Pakistan: Vulnerabilities, Social Gaps, and Rural Dynamics. Washington, DC.

World Bank (2005) Pakistan Poverty Update, 2005. Washington, DC.

Show More
Related

  • Nickel and Dimed

    2384 Words  | 5 Pages

    Sachs, J. D. (2010/2011). Can Extreme Poverty Be Eliminated? Annual Editions: Social Problems 10/11 , pp. 71-75.

    Read More

  • Income Inequality in the United States

    795 Words  | 2 Pages

    Belsie, Laurent. “The Causes of Rising Income Inequality.”.N.p., 5 Mar. 2009. Web. 30 Apr. 2014

    Read More

  • Deviant Activity Of Suicide By John Curra

    2014 Words  | 5 Pages

    This chapter, titled Suicide discusses the deviant activity of suicide. Author John Curra is a professor at Eastern Kentucky University where he teaches courses in social deviance, criminology, sociological analysis amongst more, and has authored several texts. Through the chapter, Curra defines and discusses the various forms of suicide that have been used throughout history, such as obligatory suicide, euthanasia and suicidal bombing. He also explains how these forms have adapted over time and their impact on society as well as how the act of suicide is and has been dealt with across different cultures. Curra clearly shows through this chapter to vast differences in how society reacts to and accepts suicide

    Read More

  • Poverty and Classism

    758 Words  | 2 Pages

    Most people of the society still blame the poor for their own predicament. They believe that "if there is a will there is a way". However, they do not think about their government that might had made bad decisions and policies that could actually harm successful development. This causes of poverty and inequality are usually less discussed and often neglected. We must recognize the effects poverty could have on the society and seek ways to create better understanding and resolve the issue before it is too late.

    Read More

  • Poverty in Less Developed Countries

    469 Words  | 1 Pages

    Poverty in Developing and Less Developed Countries The world includes less developed countries and developing countries. Less developed countries are countries considered to be poor and often contain many people who are in absolute poverty. Developing countries are countries like India, which are gaining in wealth. There are two types of poverty within the world.

    Read More

  • Child Soldiers: Converting Innocent Children into Armed Killers

    3190 Words  | 7 Pages

    United Nations Development Programme. Poverty Reduction and UNDP. New York: United Nations Development Programme, Jan. 2013. PDF.

    Read More

  • Critical Comparison of Theories and Approaches of Community Organizing

    2939 Words  | 6 Pages

    Shah Anup, (2013) Structural Adjustment: A major cause of poverty. Philosophy and Theory, Vol.43, No.S1, 2011, USA. http://www.globalissues.org/article/3/structural-adjustment-a-major-cause-of-poverty

    Read More

  • The Effects of Poverty in Our World

    1593 Words  | 4 Pages

    All over the world, disparities between the rich and poor, even in the wealthiest of nations is rising sharply. Fewer people are becoming increasingly “successful” and wealthy while a disproportionately larger population is also becoming even poorer. There are many issues involved when looking at poverty. It is not simply enough (or correct) to say that the poor are poor due to their own (or their government’s) bad governance and management. In fact, you could quite easily conclude that the poor are poor because the rich are rich and have the power to enforce trade agreements, which favor their interests more than the proper nations. This is a very serious problem in our society today. Poverty is everywhere and it needs to reduced so that our economy will be more stabilized and balanced that it has been. What does it mean to be poor? What does it mean to describe a nation as “developing”? A lack of material wealth does not define one as deprived. A strong economy in a developed nation does not mean much when a significant percentage or a majority of the population is struggling to survive. Development usually implies an improvement in living standards such that a person has enough food, water, and clothing, a stable social environment, freedom, and basic rights to have a fair chance for a decent life. Is this actually progress? On the other hand, are we fooled into believing that it is? The U.S. Department of Health and Human Services placed the poverty level for a family of four at $16,450 in 1998, and the poverty rate in 1996, according to the HHS, was 13.7 percent, or 36.5 million Americans. (Egendorf: 1999, 12). Is there really a way to measure poverty, and to decide exactly what poverty is? Hunger, income level, housing and the economy’s condition of the working poor are just a few example of what needs to be considered when measuring the poverty levels in our nation. Poverty expands and contracts and its definition changes in accordance with temporary exigencies, including the interests of those who propound the definitions do the counting, which means that there is no concrete definition of poverty, except for the numbers. (Valentine: 1968, 13). Poverty is not something that has just recently become an issue; it has been around for many years. The economy has been a major influence on the levels of poverty in our nation. In 1973, poverty increased ...

    Read More

  • Poverty in Developing Countries

    590 Words  | 2 Pages

    As developed countries quench their thirsts for petrol, developing countries around the world are left behind, force to watch on without any help from the outside community. Being poor means to be disadvantaged in every single way. It means not being able to support yourself or your family or have the basic necessity to life. Without substantial help for these helpless people then we should be feeling guilty that we are living lives far better than what others are experiencing. Poverty may because by wars, disease or lack of education and infrastructure and the resulting consequences may be hunger, starvation, crime and ultimately death. If poverty is not eradicated then injustice will continue, increasing death tolls and lives.

    Read More

  • Reasons for Economic Inequality in Sub-Saharan Countries

    578 Words  | 2 Pages

    Another reason to emerge economic inequality in Sub-Saharan countries is external shocks such as fluctuating exchange rates and decreasing trade. Some Sub-Saharan countries' incomes generally depend on trades; external shocks cause low incomes that affect to emerge economic inequa...

    Read More

  • Impact of Globalization on Indian Economy

    1556 Words  | 4 Pages

    The Relationship between Globalization, Economic Growth and Income Inequality. (2010, January). TEMEP Discussion Paper. Retrieved from ftp://147.46.237.98/DP-51.pdf

    Read More

  • Economic Growth Essay

    700 Words  | 2 Pages

    Economic growth is the most effective instrument for reducing poverty and enhancing the quality of life in developing countries. The benefits brought about from economic growth is strong growth and business opportunities enhance incentives. This may lead to the rise of a strong and growing group of entrepreneurs, which should generate pressure for enhanced administration. Strong economic growth therefore advances human development, which in turn promotes economic growth. But, under different conditions, comparative rates of development can have altogether different consequences for neediness, the occupation prospects of poor people and more extensive pointers of human development. The extent to which growth decreases neediness depends on the extent to which the poor take an interest in the growth process and share in its returns (Riley, G.

    Read More

  • Factors of the Correlation Between Poverty and Having Finished Secondary Education

    2450 Words  | 5 Pages

    One of the contemporary challenges facing policy makers is the incidence and spatial concentration of poverty. The multiple dimensions of poverty includes: levels of employment, education, incidence of poor health, poverty levels, and macroeconomic conditions. In this report we will examine two of them: employment rate and education to find out if countries can reduce poverty level by increasing employment rate and increasing number of people who finish at least upper secondary education. Moreover, we will find out what is more important to increase employment rate or increase number of people who finish secondary education to decrease poverty level in the countries. To find out all these things we will summarise the information, using descriptive statistics, test relationship between the variables using correlation and regression which will answer our questions.

    Read More

  • Suicide In Nepal Essay

    922 Words  | 2 Pages

    According to a Maternal Mortality Ratio (MMR) study of 2008/09 done by the ministry of health and population in Nepal, suicide was found to be the leading cause of death among the Nepalese women. Nepal is a landlocked country with the population of 26.5 million among whom 51.5% are female while 48.5% are male (Central Bureau of Statistics, 2011) . Nepal offers a variety of diversity in regards to its religion, values, ethnicities, and geography, which have a huge impact on the socio-economic status of the people. In addition, Nepal is hugely a patriarchal society with a transparent social and economic disparity throughout the country due to its hindu caste- based hierarchy. As a result we can see that there is a huge unequal gap between the marginalized and disadvantaged groups who are usually the people at the bottom of the caste hierarchy (untouchables or Dalit and Janajati).

    Read More

  • Essay On Governance

    679 Words  | 2 Pages

    Today in the present world, most countries have the core object of governance in the “public good provisioning ” leitmotif. According to the main principles ; accountability, participation and transparency, from the governance ecology interaction between the State, Civil Society and Market –place, within the global-village environment, (Higgot and Ougaard 2002; Stiglitz 2003; Woods 2006) “Governance Deteriorate the Economical Progress of the Developing Countries”(Box 15.4 Kaufmann, Kray, and Mastruzzi, 2008 p 291 Governance Matter Vll: some leading findings). In my opinion governance on itself without parametric recognition is doomed to fail, instead of reflecting to new mechanisms of responsibility to steer and guide the social and economical issues, which I will try to clarify in the upcoming body breakdown. Governance is supported as structure through institutions, as process through instruments and as agenda through elements of good governance, generating the capacity to improve significant development and positive impact of economic growth and to cut back destitution. Despite of the fact that developing countries can come in line with the quality of governance by accepting it as a crucial determinant of developmental performance, it didn’t came into effect. The underlying fact of weak and poor governance was identified as a result, for not effectuating the measureme...

    Read More

More about IMPACT OF POOR GOVERNANCE AND INCOME INEQUALITY ON POVERTY IN PAKISTAN

Open Document