bluuebunny/crossref_metadata_2025 huggingface dataset:
The Burden of Stabilisation on Provinces and Its Implications for the Social Sectors
Authors: Qazi Masood Ahmad  , Muhammad Sabir
Published: August 2018

An agenda of economic reform encompassing a broad range of structural adjustment policies (SAP) is underway in Pakistan since 1987-88. These policies have an adverse impact on the pace of economic growth and created more poverty and inequality in the country [see Bengali and Ahmed (2002); Kemal (2003)]. These studies argues that during the last fifteen years each government is trying to stabilise the economy even at the cost of economic growth and delivery of social services. The negative impact of stabilisation policies on economic growth of the country is reflected in the decline of GDP growth from an average annual growth of 4.6 percent during 1990s as compared to 6.5 percent during 1980s. Similarly, negligence of social services delivery is reflected in the recent UNDP Report (2003), which, show that the ranking of Pakistan has slipped from 136 to 141 along with the decline in many other social sector statistics. The top government officials now also recognise these facts and the relapse of growth oriented policy can be heard more often. Trend in public finance statistics of the country clearly indicate that one of the important victim of stabilisation policies are the expenditures of provincial governments. In last several years the significant portion of onus of containment of fiscal deficit has been shifted towards the provincial governments. The onus of containment of fiscal deficit by all four provincial governments during the last decade has increased from 18 percent to 50 percent, which has devastating impact on the service provision and poverty reduction.
Trends in Inequality in Pakistan between 1998-99 and 2001-02
Authors: Talat Anwar
Published: August 2018

Although there has been a much debate on poverty in Pakistan in recent time, the discussion on inequality remained limited. Poverty and inequality are closely linked—for a given mean income, the more unequal the income distribution, the larger the percentage of the population living in income poverty. Thus, incomes at the top and in the middle of the distribution may be just as important to us in perceiving and measuring poverty as those at the bottom. It is, thus, important to monitor the whole income distribution rather than merely the bottom of distribution. The issue of income inequality in Pakistan has been important in the policy discussions since the early 1960s. Since then, a number of attempts have been made to estimate the income or expenditure inequality using the Household Income and Expenditure Survey (HIES) data. However, a perception of increasing absolute poverty in Pakistan has shifted the focus of studies from inequality (or relative poverty) to absolute poverty. Consequently, a number of attempts have been made by various authors/institutions to estimate the poverty in Pakistan in the 1990s. The debate on trends in poverty during the 1990s—an era of stabilisation and structural adjustment has been wide-ranging in Pakistan. However, there is no discussion on the changes in income distribution from the policy and institutional reforms. World Bank (2003); FBS (2001) and Kemal (2003) are only three exceptions. While the former two studies report Gini Coefficients in their studies on absolute poverty in Pakistan without explaining its variations over time, the latter study is a comprehensive review on the income distribution in Pakistan.
Decomposition of Changes in Poverty Measures: Sectoral and Institutional Considerations for the Poverty Reduction Strategy Paper of Pakistan
Authors: Aliya H. khan  , Ali Shan Azhar
Published: August 2018

Two extremely significant empirical questions on the relationship between growth, distribution and poverty have remained the focus of attention for researchers and academicians. First, how does a change in aggregate poverty reflect intrasectoral gains/losses versus intersectoral shifts in population? Second, how much of an observed change in poverty can be attributed to the changes in the distribution of income, as distinct from growth in average incomes? Standard inequality measures like the Gini coefficient can be misleading in this context. At any rate, the change in an inequality measure can be a poor guide to its quantitative impact on poverty. Ravallion and Huppi (1991) proposed decomposition formulae to throw light on the contributions of sectoral gains and population shifts (on the one hand) and economic growth and changes in inequality (on the other) to aggregate changes in poverty. They found that both population shifts and gains to the urban and rural sectors alleviated aggregate poverty in Indonesia over the 1984-87 period. In addition, they obtained estimates of the relative contributions of growth and greater equity to poverty alleviation in Indonesia. Datt and Ravallion (1992) extended the analysis to study poverty in Brazil and India during the 1980s. Kakwani (1993) explored the relation between economic growth and poverty for Cote d’Ivoire from 1980-85. He developed his own methodology to measure separately the impact of changes in average income and income inequality on poverty. Kakwani (2000) applied the same methodology to analyse changes in poverty in Thailand covering the period from 1988-94. Recently, Contreas (2003) examined the evolution of poverty and inequality in Chile between 1990 and 1996. Using the “Datt-Ravallion decomposition”, he computed that economic growth accounted for over 85 percent of the poverty reduction in Chile.
The Impacts of Economic Reforms and Trade Liberalisation on Agricultural Export Performance in Pakistan
Authors: Zulfiqar Bashir
Published: August 2018

Economic reforms and trade liberalisation policies have been widely adopted in developing countries in recent years. Pakistan is no exception. This paper focuses on the effects of economic reform policies on the agricultural export performance. A number of studies have investigated the effects of trade liberalisation on export growth in developing countries, and have reached inconclusive results. Some studies have identified positive effects of trade liberalisation on export performance [Krueger (1997); Bleaney (1999); and Ahmed (2002)], others confirmed an insignificant or even a negative relationship [Greenaway, et al. (1994); Jenkins (1996) and Greenaway, et al. (2002)]. There are number of reasons for conflicting conclusions including different researchers have used different indicators for liberalisation and different methods to analyse the effect; difference in the extent of liberalisation studies; most studies have analysed scenarios rather than evaluating the effects, and so on.
Money-income Link in Developing Countries: a Heterogeneous Dynamic Panel Data Approach
Authors: Azhar Iqbal  , Muhammad Sabihuddin Butt
Published: August 2018

The question whether real money causes real output appears to be important for many economists working in the area of macroeconomics and, has been subjected to a variety of modern econometric techniques, producing conflicting results. One often applied method to investigate the empirical relationship between money and real activity is Granger causality analysis [Granger (1969)]. Using this approach, the causality question can be sharply posed as whether past values of money help to predict current values of output. This concept, however, should be clearly distinguished from any richer philosophical notion of causality [cf. Holland (1986)]. Present paper examines the relationship between money (both M1 and M2) and income (Real GDP) for 15 developing countries using a newly developed heterogeneous dynamic panel data approach.1 Sims (1972) postulated “the hypothesis that causality is unidirectional from money to income agrees with the post war U.S. data, whereas the hypothesis that causality is unidirectional from income to money is rejected”. Since then a voluminous literature has emerged testing the direction of causality.2 Some studies have tested the relationship between these variables and the direction of causality for a particular country using time series techniques [e.g., Hsiao (1979) for Canada, Stock and Watson (1989) for U.S. data, Friedman and Kuttner (1992, 1993) for U.S. data, Thoma (1994) for U.S. data, Christiana and Ljungquist (1988) for U.S. data, Davis and Tanner (1997) for U.S. data, Jusoh (1986) for Malaysia, Zubaidi, et al. (1996) for Malaysia, Biswas and Saunders (1998) for India, and Bengali, et al. (1999) for Pakistan]. Other studies have tested the above on a number of countries, for example Krol and Ohanian (1990) used the data for Canada, Germany, Japan and the U.K. Hayo (1999) using data from 14 European Union (EU) countries plus Canada, Japan, and the United States. More recently Hafer and Kutan (2002) used a sample of 20 industrialised and developing countries. This paper contributes to this later strand of the literature, which it extends in three directions. First, it employed a newly developed panel cointegration technique [Larsson, et al. (2001)], to examine the long-run relationship between money and income. Second, the study performs panel causality test, recently developed by Hurlin and Venet (2001), to explore the direction of causality between the said variables. Third, the important contribution of the present study is to test whether relationship between money and income is homogeneous or heterogeneous across countries.
Energy and Economic Growth in Pakistan
Authors: Rehana Siddiqui
Published: August 2018

Recent rise in energy prices, shrinking existing resources, and the search for alternative sources of energy and energy conservation technologies have brought into focus the issue of causality between energy use and economic growth. The results of this study show that energy expansion is expected to lead to higher growth and its shortage may retard the growth process. The impact of all sources of energy on economic growth is not the same. The impact of electricity and petroleum products as well as that of electricity only is high and statistically significant. However, the reverse causality is critical for the petroleum products.
Guy Bessettle. Involving the Community: A Guide to Participatory Development Communication. Penang, Malaysia: Southbound. 2004. xiv+154 pages. Paperback. Price not given.
Authors: Usman Mustafa
Published: August 2018

Participatory approaches, tools, and methods have become a buzzword and common practice in development programmes throughout the world. Institutions of participatory development, specialised expertise, and a body of knowledge relating to participatory development, developed over the last couple of decades, are now an important part of the development literature. Whereas much of the theory and practice in the Development Economics has been based on top-down models, they are being replaced by bottom-up participatory strategies to ensure that socioeconomic needs of the poor and the vulnerable are met. There is ample evidence that participation strategies have been quite successful in the realisation of economic and social objectives.
Trade Policy and Economic Integration in a Cournot Duopoly Model
Authors: Yu-Ter Wang  , Bih-Jane Liu  , Pan-Long Tsai
Published: August 2018

This paper investigates the policy and welfare implications of forming an economic region in the context of a Cournot duopoly model. Some theoretical results are obtained. First, the economic region lowers the external tariff (against non-partner countries) less than its pre-integration level when a sufficiently large subsidy on the imports from the partner is carried out. Second, economic integration reduces the non-partner country’s welfare. Third, although the region still gains from integration even under some partial trade liberalisation regimes, complete trade liberalisation within the region leads to higher regional welfare. Finally, trade liberalisation within the region improves the welfare of the world as a whole.
Craig Burnside (ed.). Fiscal Sustainability in Theory and Practice: A Handbook. Washington, D. C.: World Bank. 2005. pp.xx+285. Price not given.
Authors: Kalbe Abbas
Published: August 2018

Fiscal sustainability is essential for economic growth and comprises a set of fiscal policies that result in financial solvency over the long run. As such, fiscal sustainability is the prime objective of the World Bank’s Quality of Fiscal Adjustment Thematic Group (QFATG). It is a main issue in developing countries. The articles compiled from many journals here address fiscal sustainability analysis and the practical work undertaken by the Bank’s Development Economic Research Group (DECRG) or Poverty Reduction Economic Management undertaken by the Economic Policy Group (PRMEG) and others. This book, basically a combination of economic theory and practical methods of analysis, provides a simple set of tools to assess a government’s budget and debt position and is a comprehensive source of information on fiscal sustainability. It describes the effects of business cycles on public finance and examines the role of fiscal rule and currency crises and their impact on fiscal sustainability. Some basic concepts are explained, with solutions of complicated practical problems such as contingent liabilities, external debt position, and fiscal federalism.
Impact of Changing Profile of Rural Land Market in Pakistan on Resource Allocation and Equity
Authors: Madeeha G. Qureshi  , Sarfraz Khani Quresh
Published: August 2018

An attempt is made to determine the nature of land market as to how far it approximates the ideal of competitive market. It also reviews the farm size, efficiency and productivity relationship. The paper is organised in four sections. After the introductory section, the literature on past research on land markets in Pakistan and other countries is brought together in Section II. Description of land market institutions and changes in the structure of land markets including the pattern of ownership and the operational distribution of land and trends in different facets of land markets are the subject matter of Section III. Summary and conclusions are presented in the concluding section.
Exports and Economic Growth Nexus: The Case of Pakistan
Authors: Nasim Shah Shirazi  , Turkhan Ali Abdul Manap
Published: August 2018

The theoretical association between trade and economic growth has been discussed for over two centuries. However, controversy still persists regarding their real effects. The favourable arguments with respect to trade can be traced back to the classical school of economic thought that started with Adam Smith and subsequently enriched by the work of Ricardo, Torrens, James Mill and John Stuart Mill in the first part of the nineteenth century. Since then the justification for free trade and the various and indisputable benefits that international specialisation brings to the productivity of nations have been widely discussed in the economic literature [Bhagwati (1978) and Krueger (1978)]. The suitability of trade policy-import substitution or export promotion—for growth and development has been also debated in the literature. In 1950s and 1960s, most of the developing countries followed import substitution (IS) policies for the economic growth. The proponents of the IS policy stress upon the need for developing countries (LDCs) to evolve their own style of development and to control their own destiny [Todaro and Smith (2003), p. 556]. Since the mid-1970s, in most developing countries, there has been considerable shift towards export promotion strategy (EP). 1 This approach postulates that export expansion leads to better resource allocation, creating economies of scale and production efficiency through technological development, capital formation, and employment generation.
Financial Market Linkages in South Asia: Evidence Using a Multivariate GARCH Model
Authors: Ahmed M. Khalid  , Gulasekaran Rajaguru
Published: August 2018

The economic and social benefits of more openness and internationalisation are well supported by both academics and policy-makers. Many countries are also trying to become part of the world trade bloc such as the World Trade Organisation (WTO) or AFTA. Efforts are also made to strengthen the existing regional economic and trade coordination or establish new regional economic and financial integration. Unfortunately, at the time (during the 1980s and 1990s) when many emerging economies in East Asia were involved in openness, internationalisation and regional economic and financial integration, the South Asian countries wasted their resources in dealing with political crisis (such as Bangladesh), internal conflicts (such as Sri Lanka) or border issues (such as India and Pakistan). It is only recently that regimes have realised that a peaceful economic environment is essential to attract foreign investment, pursue a pro-growth policy and achieve a sustainable growth. The recent dialogue between Pakistan and India and some progress in SAARC consultation are a few steps towards these goals.
Macroeconomic Factors and Pakistani Equity Market”
Authors: Muhammad Nishat
Published: August 2018

This paper analyzes long-term equilibrium relationships between a group of macroeconomic variables and the Karachi Stock Exchange Index. The macroeconomic variables are represented by the industrial production index, the consumer price index, M1, and the value of an investment earning the money market rate. We employ a vector error correction model to explore such relationships during 1973:1 to 2004:4. We found that these five variables are cointegrated and two long-term equilibrium relationships exist among these variables. Our results indicated a "causal" relationship between the stock market and the economy. Analysis of our results indicates that industrial production is the largest positive determinant of Pakistani stock prices, while inflation is the largest negative determinant of stock prices in Pakistan. We found that while macroeconomic variables Granger-caused stock price movements, the reverse causality was observed in case of industrial production and stock prices. Furthermore, we found that statistically significant lag lengths between fluctuations in the stock market and changes in the real economy are relatively short.
Linkage between Stock Market Prices and Exchange Rate: A Causality Analysis for Pakistan
Authors: Mohammad Farooq  , Wong Wing Keung
Published: August 2018

Globalisation and financial sector reforms in developing economies have ushered in a sea change in the financial architecture of the economies. In the contemporary scenario, the activities in the financial markets and their relationships with the real sector have assumed significant importance. Correspondingly, researches are also being conducted to understand the current working of the economic and the financial system in the new scenario. Interesting results are emerging particularly for the developing countries where the markets are experiencing new relationships which are not perceived earlier. The analysis on stock markets has come to the fore since this is the most sensitive segment of the economy. The stock markets of emerging economies have been of vital importance to the global investment community. Since emerging markets are more volatile than the well developed stock market, therefore the emerging markets tend to be unrelated to one another and with the developed markets. Numerous investors worldwide select to diversify their funds across the emerging markets.
Is Pakistan’s Manufacturing Sector Competitive?
Authors: Iffat Ara
Published: August 2018

The manufacturing sector of any country bears significant importance. Globalisation, and in particular, enhanced exports are generally believed to benefit developing countries. And with Pakistan’s exports concentrated largely in textile and semi-manufactures, the country needs to strengthen this sector. Since the foreigncurrency dominated export prices for developing countries are largely determined in the international market, any downward slide in them exerts a downward slide in foreign-exchange export earnings. It is therefore imperative, for a country like Pakistan, to prevent the decline in manufacturing output, not only to sustain but also to increase the export share and hence to gain external competitiveness in this sector.
The Impact of FDI on Economic Growth under Foreign Trade Regimes: A Case Study of Pakistan
Authors: Zeshan Atique  , Mohsin Hasnain Ahmad
Published: August 2018

Foreign Direct Investment (FDI) as a growth-enhancing component has received great attention of developed countries in general and less developed countries in particular in recent decades. It has been a matter of great concern for many economists that how FDI affects economic growth of the host country. In a closed economy, with no access to foreign saving, investment is financed solely from domestic savings. However, in open economy investment is financed both through domestic savings and foreign capital flows, including FDI. The investments in form of FDI enable investment-receiving (host) countries to achieve investment levels beyond their capacity to save.
External Determinants of Growth and Growth Projections: SAARC and Pakistan
Authors: Faiza Amjad  , Naheed Zia Khan
Published: August 2018

The world is increasingly being divided into regions. The regional trading blocs are becoming more and more deepened and widened around the globe. The European Union (EU) has already reached a stage approximating to the trading relations usually found within a country rather than between the countries. The existence of regional economic groups, particularly in European and American continents, pose a range of theoretical, empirical and organisational questions for developing countries like Pakistan who depend on the countries of these regions for a significantly high share of their international trade. This paper focuses on the prospects of extended economic cooperation of Pakistan with the member countries of the South Asian Association for Regional Cooperation (SAARC).1 The argument is structured around three parts. Part I reviews the theoretical rationale of regional economic cooperation and the recent developments shaping the trading relations within the cooperating blocs. Part II critically evaluates the relative size and significance of the external sector of the SAARC region countries, along with presenting statistical estimates of the major external determinants of the region’s economic growth. Finally, Part III estimates the relationship of major directions of Pakistan’s exports with the economic growth of the country and presents the growth projections by increasing and diverting the exports to the SAARC and ASEAN region countries.
Landlessness and Rural Poverty in Pakistan
Authors: Talat Anwar  , Sarfraz Khan Qureshi
Published: August 2018

Poverty imposes a repressive weight on Pakistan particularly in rural areas where almost one third of population and majority of the poor live. Although poverty has declined during the 1970s and 1980s, the absolute number of poor has increased substantially since the 1960s. Despite a number of policy initiatives and programmes undertaken for poverty alleviation by various governments, absolute poverty particularly in rural areas continued to rise in Pakistan during the 1990s. Much has been written about poverty in Pakistan so far. A number of attempts have been made by various authors/institutions to estimate the rural poverty in Pakistan in the 1990s. Discussions have remained limited to estimating the regional and provincial trends for rural poverty in Pakistan. Although landlessness and rural poverty in Pakistan received significant attention in the 1970 and 1980, discussions on this issue remained limited in the 1990s. Landlessness and rural poverty are closely linked since land is a principal asset in a rural economy like Pakistan. Landlessness to agricultural land is considered to be the most important contributor to rural poverty. A high concentration of landownership is a major constraint to agricultural growth and alleviation of poverty. There is a general perception that highly skewed distribution of land in Pakistan is one of the important causes of widespread poverty particularly in rural areas.
Inaugural Address
Authors: Omar Ayub Khan
Published: August 2018

I would like to extend a very warm welcome to all of you assembled here this morning. It is a great honour for me to address this opening session of the Twentieth Annual General Meeting and Conference of the Pakistan Society of Development Economists. Recent decades have witnessed a proliferation of regional integration schemes around the world involving both developed and developing countries alike. In the context of developing economies, the promotion of regional economic cooperation and integration is increasingly being viewed as an important instrument for expediting the process of economic development. It is widely believed that regional economic cooperation yields gains in production specialisation, efficiency and improved quality of exports, all of which benefit the countries participating in the regional cooperation effort.
Making Regional Economic Integration Work (The Quaid-i-Azam Memorial Lecture)
Authors: Agustín Carstens
Published: August 2018

The world has been witnessing a wave of regionalism in recent years. Preferential trade arrangements (PTAs) have been a central element of most regional agreements. This paper looks at the growing international experience with PTAs. It first provides some basic facts on the extent of regionalism and discusses the motives for entering into regional arrangements. This is followed by an analysis of the impact of PTAs on trade, growth, and welfare, based on traditional and new trade theories. Although the paper finds that empirical studies seem to conclude that in practice PTAs are not harmful or necessarily very beneficial, the main conclusion of the paper is that regional integration can work if done right, and can be pursued in parallel with, or as a stepping-stone towards, multilateral trade liberalisation. The paper provides four major recommendations to ensure that PTAs have a positive impact on member (and nonmember) countries. These include: (i) a large and diverse membership; (ii) continued reduction in external tariffs; (iii) comprehensive product coverage, with simple and transparent rules of origin; and (iv) effective implementation.
Globalisation and Pakistan’s Dilemma of Development (Distinguished Lecture)
Authors: Hassan N. Gardezi
Published: August 2018

I open Peter Singer’s One World: The Ethics of Globalization to a ‘local’ and a ‘global’ text, and am thereby led to argue that problems of poverty, inequality, governance, corruption, transparency, tolerance, growth and welfare, and more generally of justice and freedom, be they economic or political, are not the monopoly or ward of a particular region, packages to be pried open by the language of economic theory alone. They rather demand an acknowledgement that an economy is also a society, a polity, a community, a collectivity in short; and a conceptual recognition by agents, albeit embodied with their own needs and desires, that is correspondingly capacious. Thus, to move beyond conception to fruition, theory, of necessity, can hardly ignore values garnered from the past, ethics, and therefore texts, local to the collectivity, that make its past come alive.
An Analysis of Occupational Choice in Pakistan: A Multinomial Approach
Authors: Zafar Mueen Nasir
Published: August 2018

Occupational choice plays an important role in determining earnings and success in the labour market. In the social structure of Pakistan, an occupation reflects the socio-economic status of the individual. In this backdrop, the paper looks at the occupational structure and analyses how different characteristics help individuals to access jobs of their choice. The main issue discussed in the paper is how men and women have a different occupation distribution. Estimates are based on a multinomial log model of occupation choices for men and women, using the Pakistan Integrated Household Survey (PIHS) 2001-02 data. The empirical results show that individuals with high educational achievements choose high-ranking jobs. It is also noted that gender has a role in the labour market and males are sorted out in high-paying occupation. Occupational choice is influenced more by the human capital variables than by the individual characteristics. Among human capital variables, education has the strongest impact in the selection of an occupation of choice.
Anwar Shah (ed.). Public Expenditure Analysis. Washington, D. C.: The World Bank, 2005. xxxi+256 pages. Paperback. Price not given.
Authors: Kalbe Abbas
Published: August 2018

Public Expenditure Analysis is the 7th edition in the “Public Sector Governance and Accountability Series” edited by Anwar Shah. The book attempts to contribute to public sector reforms by improving governance in the public expenditure analysis—to disburse the benefits to grossroots levels in the developing countries. It deals with the intricate issue of equity in both the tax burdens and public spending and evaluates performance of government in safeguarding the interests of the poor and other disadvantaged groups of the society, such as women, children, and minorities. The eight chapters of the book that consist of papers prepared by distinguished authors systematically develop a framework for a right-based approach to citizen empowerment by creating an institutional design with appropriate rules, restraints, and incentives to make the public sector responsive and accountable to the average voter.
Shorter Notices
Authors: Afia Malik
Published: August 2018

Detail is in PDF file
Modelling the Demand for Money in Pakistan
Authors: Abdul Qayyum
Published: August 2018

The study estimates the dynamic demand for money (M2) function in Pakistan by employing cointegration analysis and error correction mechanism. The parameters of preferred model are found to be super-exogenous for the relevant class of interventions. It is found that the rate of inflation is an important determinant of money demand in Pakistan. The analysis reveals that the rates of interest, market rate, and bond yield are important for the long-run money demand behaviour. Since the preferred model is superexogenous, it can be used for policy analysis in Pakistan.
Vijay Padaki and Manjulika Vaz. Institutional Development in Social Interventions: Towards Inter-organizational Effectiveness. New Delhi: Sage Publications, 2003. 256 pages. Indian Rs 295.00.
Authors: Naghmana Ghani
Published: August 2018

Is an institution the same as an organisation? Why do organisations organise themselves into institutional forms? What makes some institutions more successful than others? How do we define and assess ‘success’? Does institutionalisation require formalisation? How do we go about building and developing institutions? These are some of the questions that are the subject matter of the book under review. It was a research project undertaken by a Bangalore-based management research and consultancy centre from 1997 to 1999 that provided the necessary impetus and focus for institutional development in the special context of development interventions. This book is in the nature of a presentation of a work-in-progress and not merely a report of a research project.
Prevalence of Relative Poverty in Pakistan
Authors: Talat Anwar
Published: August 2018

Much has been written11about poverty in Pakistan. A large number of attempts have been made by various authors/institutions to estimate the poverty in Pakistan over the last four decades. However, the conceptual basis of poverty remained limited to absolute concept of poverty. The concept of absolute poverty emphasises to estimate the cost of purchasing a minimum ‘basket’ of goods required for human survival. In Pakistan, the discussion has been centered on estimating poverty lines consistent with 2550 or 2350 calorie intake per adult per day as minimum requirement. Thus, absolute definitions of poverty tend to be minimalist and are based on subsistence and the attainment of physical efficiency. Subsistence is concerned with the minimum provision needed to maintain health and working capacity.
Skill Formation Strategies for Sustaining ‘The Drive to Maturity’ in Pakistan
Authors: Muhammad Zahid Siddique  , Javed Akbar Ansari
Published: August 2018

Skill formation is a multi-faceted process. Skills are necessarily (by definition) instrumental—i.e. means for the achievement of a metaphysically defined objective. In Modernity,1 this metaphysical presupposed ‘rational’ purpose of existence (both individual and societal) is freedom [Kant (2001)]. In the history of Modernity, the primary source of the growth of freedom has been capital accumulation.2 A nation committed to Modernity (‘Enlightened Moderation’) is necessarily committed to articulating a skill formation strategy which can transform ‘human being’ into ‘human capital’. This transformation requires three distinct types of skills: individual, communitarian and political. This is because capitalism is not just a ‘lifeworld’ in the Habermasian sense but a system [Foucault (1976)]. Capitalist individuality requires a prioritisation of the preference for preference itself (‘choice’) over all preferences. This is necessary for the internalisation of capitalist norms (the commitment to profit/utility maximisation and competition to achieve this end). Capitalist individuality must also posses the skills which allow it to rationally identify and pursue its interest in the market and in the firm. It must also have the selfdiscipline to function as a diligent and co-operative participant in the capitalist work process.
Modelling Gender Dimensions of the Impact of Economic Reforms on Time Allocation among Market, Household, and Leisure Activities in Pakistan
Authors: Rizwana Siddiquii
Published: August 2018

Women and men are different from each other not only biologically but also in terms of constraints and discriminatory behaviour they face. Women are less fed, less educated, less mobile, less empowered, and overburdened by household work such as cooking, cleaning, taking care of children and the aged, fetching water, looking after farm animals, and gathering wood [Cagatay (1995); Sathar and Kazi (1997); Siddiqui, et al. (2001)]. These activities not only restrain them from education and training but also severely constrain their ability to respond to economic incentives as men do and fail to achieve equal level of men. Men as a breadwinner receive both nutritional and educational priority [White and Masset (2002)], while women remain relatively illiterate and malnourished. Consequently, different quality and quantity of female-labour and male-labour emerges which play a very important role in determining the impact of any policy change.
An Analysis of Allocative Efficiency of Wheat Growers in Northern Pakistan
Authors: Muhammad Bashir  , Dilawar Khan
Published: August 2018

For the last couple of years several agricultural and trade experts have been advocating if Pakistan has to compete in the international market for export of agricultural products then it needs to decrease the cost of production. In the light of Agreement on Agriculture of WTO, member countries are required to provide increased market access, decrease domestic support and tariff. These agreements are likely to increase the cost of production of various agricultural products for farmers producing these products, and make international competition tougher for export of agricultural commodities. There are three possible ways to decrease the cost of production—by decreasing cost of inputs, by developing cost effective high yielding technologies or by improving management practices. There is little hope for decrease in the cost of inputs. Over the recent years prices of the petroleum products, were revised upward several times and this trend is likely to continue in future. Similarly, there was increase in the prices of gas, electricity and other agricultural inputs. Historically, in Pakistan, increase in prices of agricultural inputs has been much higher than the increase in prices of agricultural outputs [Pakistan (1988)]. Under these circumstances there is little hope of decease in prices of agricultural inputs. As far as development of new agricultural technologies, particularly high yielding varieties, is concerned it is a long-term process. It takes several years to develop a new variety and in its formal approval for distribution to farmers. Nevertheless, there is room for decreasing cost of producing through improvement in the management practices. When economists talk about improvement in the management practices they talk in terms of ‘technical efficiency’ and ‘allocative efficiency’. Technical efficiency has been defined as firm’s ability to produce maximum output given a set of inputs and technology.
Estimation of Export Supply Function for Citrus Fruit in Pakistan
Authors: Usman Haleem  , Khalid Mushtaq  , Azhar Abbas  , A. D. Sheikh
Published: August 2018

Nature has blessed Pakistan with an ideal climate for growing a wide range of delicious fruits. Thus a very wide range of tropical, sub-tropical and temperate fruits are grown in the country. Over the years, Pakistani experts have developed unique strains of exotic fruit varieties. Pakistan is producing a large variety of fruits on an area of 734.6 thousand hectares with a total production of 5712.4 thousand tons. Out of this 354.4 thousand tons fruit is exported from the country [Pakistan (2004)]. Horticulture is an important sub-sector of agriculture and plays a vital role not only in rejuvenation of rural economy but also in improving human nutrition which is often deficient in ingredients such as vitamins and minerals. Citrus and mango are the main fruit crops which contribute substantially to the national income.
Citrus Marketing in Punjab: Constraints and Potential for Improvement
Authors: Muhammad Sharif
Published: August 2018

Pakistan is blessed with the agro-ecological environment conducive to the production of nearly thirty types of fruits of which citrus, mango, dates, guava, apple, melons and banana are relatively more common. The market value of these fruits produced during 2002-03 is estimated at about Rs 73 billion, which is roughly 6.73 percent of agriculture value added in the year [Pakistan (2004)]. During the same period, Pakistan earned nearly 5 billion rupees from fruit exports, representing 9 percent of total export earnings from all raw agricultural commodities. Citrus is the largest grown fruit in Pakistan. The market value of citrus produced in 2002-03 was Rs 10.6 billion [Pakistan (2004)]. Within the citrus family, Kinnow is the largest planted specie.
Total Factor Productivity Growth and Agricultural Research and Extension: An Analysis of Pakistan’s Agriculture, 1960-1996
Authors: Shujat Ali
Published: August 2018

Pakistan’s agriculture has grown rapidly since the 1960s, with an average annual growth of about 4 percent over the four decades till the end of the century. Agricultural growth at this rate was sustained by the technological progress embodied in the high-yielding varieties of grains and cotton, with supporting public investment in irrigation, agricultural research and extension (R&E), and physical infrastructure. This rate of agricultural growth has significantly contributed to the overall economic growth of about 6 percent per year during this period. Sustaining this performance presents a considerable challenge for the public policy framework for agriculture, not the least for the agricultural research and extension system in Pakistan. The central role of technological change in increasing agricultural productivity is well established in the wake of the Green Revolution experience across much of Asia. In the context of Pakistan, it has been estimated that almost 58 percent of the total output growth from 1960 to 1996 was due to technological change [Ali (2000)]. While improvements in the physical and market infrastructure, farmer education, price policies, and weather, all have their place in enhancing agricultural production, R&E investments has been regarded by far the most important contributor to agricultural productivity growth [Evenson and Rosegrant (1993); Byerlee (1994)].
Impact of Exchange Rate Volatility on Growth and Economic Performance: A Case Study of Pakistan, 1973-2003
Authors: Toseef Azid  , Muhammad Jamil  , Aneela Kousar
Published: August 2018

“Exchange rate” is the price of one currency in relation to another. In a slightly different perspective, it expresses the national currency’s quotation in respect to foreign ones. Thus, exchange rate is a conversion factor, a multiplier or a ratio, depending on the direction of conversion. It is believed that if exchange rates can freely move, it may turn out to be the fastest moving price in the economy, bringing together all the foreign goods with it. In the existing literature, (most of the time) volatility comes with the exchange rate. Volatility is defined as “instability, fickleness or uncertainty” and is a measure of risk, whether in asset pricing, portfolio optimisation, option pricing, or risk management, and presents a careful example of risk measurement, which could be the input to a variety of economic decisions.
Evidence on Allocative Efficiency and Elasticities of Substitution in the Manufacturing Sector of Pakistan
Authors: Sohail Zafar  , Eatzaz Ahmed
Published: August 2018

Lack of effective competition in factor markets often produces allocative or price inefficiencies in the manufacturing sector of developing countries like Pakistan. Such inefficiencies are common due to distortion in factor markets leading to the use of inappropriate factor proportions Lau and Yotopoulos (1971, 1972), Yotopoulos and Lau (1973), Burki, et al. (1997), Khan (1998), Ahmed (1999), Zafar (2000). Pakistan is also one of the country where labour is abundant but capital and raw material are scarce. Our finding undermine estimates of elasticities of demand and substitution based on classical assumption that factor markets are perfectly competitive i.e. Kazi, et al. (1976), Kemal (1981), Battese and Malik (1987, 1988, 1993), Malik, et al. (1989), Mahmood (1989, 1992), Zahid, et al. (1992) and Khan and Rafiq (1993). In order to discuss the cost structure of the manufacturing sector we will estimate well behaved translog cost function.
Performance Evaluation of Mutual Funds in Pakistan
Authors: S M Aamir Shah  , Syed Tahir Hijazi
Published: August 2018

In Pakistan Mutual Funds were introduced in 1962, when the public offering of National Investment (Unit) Trust (NIT) was introduced which is an open-end mutual fund. In 1966 another fund that is Investment Corporation of Pakistan (ICP) was establishment. ICP subsequently offered a series of closed-end mutual funds. Up to early 1990s, twenty six (26) closed-end ICP mutual funds had been floated by Investment Corporation of Pakistan. After considering the option of restructuring the corporation, government decided to wind up ICP in June, 2000. In 2002, the Government started Privatisation of the Investment Corporation of Pakistan. 25 Out of 26 closed-end funds of ICP were split into two lots. There had been a competitive bidding for the privatisation of funds. Management Right of Lot-A comprising 12 funds was acquired by ABAMCO Limited. Out of these 12, the first 9 funds were merged into a single closed-end fund and that was named as ABAMCO Capital Fund, except 4th ICP mutual fund as the certificate holders of the 4th ICP fund had not approved the scheme of arrangement of Amalgamation into ABAMCO capital fund in their extra ordinary general meeting held on December 20, 2003. The fund has therefore been reorganised as a separate closedend trust and named as ABAMCO Growth Fund. Rest of the three funds were merged into another single and named as ABAMCO Stock Market Fund. So far as the Lot-B is concerned, it comprised of 13 ICP funds, for all of these thirteen funds, the Management Right was acquired by PICIC Asset Management Company Limited. All of these thirteen funds were merged into a single closed-end fund which was named as “PICIC Investment Fund”. Later on the 26th fund of ICP (ICP-SEMF) was also acquired by PICIC Asset Management Company Limited.
Interest Rate Pass-through in Pakistan: Evidence from Transfer Function Approach
Authors: Abdul Qayyum
Published: August 2018

The transmission of monetary policy through the interest rate mechanism has been thoroughly discussed in economic literature for quite some time. The traditional view is that, the change in real interest rate influences the cost of capital. The change in cost of capital affects the magnitude of investment and consumption and therefore the level of, real income and prices [Mishkin (1995)].1 Operationally the State bank of Pakistan, influences the yield on treasury bills (T-bills). This is done on the assumption that the yield on treasury bills influences other interest rates like the Money Market rate (Call money rate), banks’ deposit and banks’ Lending rates. The change in these rates influences the cost of capital and thus level of investment and consumption in the economy. Given this, the central bank can influence the yield on T-bills to influence the level of real income and the level of prices. The foregoing explanation of the monetary transmission mechanism makes it clear that if the changes in yield on the T-Bill rate are not passed on to the Call money rate and the bank deposit and the Lending rate then it becomes difficult for the central bank to use the channels that involve interest rate, for influencing the level of output and prices. Hence it is important to test whether the changes in the treasury bill rate are passed on to money market rate, bank deposit rate and the bank lending rate and if yes at what speed and to what extent. Therefore this study examines the pass-through of the changes in Treasury bill rate to Call Money rate, Banks’ deposit rate and Banks’ Lending rate.
Skills and Competitiveness: Can Pakistan Break Out of the Low-level Skills Trap? (The Iqbal Memorial Lecture)
Authors: Rashid Amjad
Published: August 2018

The paper argues that if Pakistan is to survive and prosper under the competitive conditions of the new global economy, then it must move away from its overwhelming dependence on “cottonomics” into more technology- and knowledge-based products where global growth is concentrated. For this to happen, it must break out of the “lowlevel skills trap”, which is the result of the very low levels of education and skills of its work force. It then poses the question whether the development of a well-educated and skilled labour force is sufficient for the country to graduate from labour-intensive to higher value-added, skill-intensive, technologically advanced sectors. The paper argues that while this is essential, the real challenge is to change the mind-set and develop institutions which recognise the value of investing in people and provide dignity, respect, and a fair deal for working men and women.
Human Capital and Economic Growth in Pakistan (Distinguished Lecture)
Authors: Mohsin S. Khan
Published: August 2018

Pakistan’s economy has grown faster on average than many other low- and middleincome countries over the past two decades. But several countries in Southeast Asia have fared even better. This paper focuses on factors that explain Pakistan’s relative growth performance. In addition to more traditional factors believed to determine growth, this paper looks particularly at the role of differences in the quality of human capital. The cross-country empirical results suggest that accumulation of physical capital and improvements in the quality of institutions have the largest pay-offs in terms of achieving higher growth, but that better education and health care also have a significant impact. Investment in these areas will increase the possibility of Pakistan entering a virtuous cycle of high growth and improved living conditions for the population.