Template-Type: ReDIF-Article 1.0 Author-Name: Munir Ahmad Author-X-Name-First: Munir Author-X-Name-Last: Ahmad Author-Workplace-Name: Pakistan Institute of Development Economics, Islamabad Title: Agricultural Productivity Growth Differential in Punjab, Pakistan: A District-level Analysis Abstract: The results of this paper show that the crop output increased at the rate of 2.6 percent per annum, dominated by the share of TFP growth. Wide variation exists among cropping systems as well as within the system both in TFP growth and output growth. The mungbean zone emerged as a leader in TFP growth with 3.6 percent per annum, followed by barani (3.2 percent), cotton (1.9 percent), mixed (1.1 percent), and rice (1.0 percent) zones. Rice, mixed, and cotton zones show a negative trend in efficiency, and the respective causes appear to be the dominant factor of land degradation sourced by the existence of nutrient-exhaustive cropping pattern, increasing problem of waterlogging and salinity, and the use of brackish underground water, plus the prevalence of curl leaf virus disease in the cotton zone during the 1990s. The other reasons could be the low literacy rate among the farmers in most of the districts of the latter two cropping systems. Besides, the majority of them are also characterised as having very low status in development ranking. The data also show that the area under rice and sugarcane, a highly water-intensive crop, had increased in most of the districts of mixed and cotton zones, during the 1990s instrumented by high instability in cotton output growth as compared to rice and sugarcane. The sources of instability include high volatility in prices, vulnerability of the crop to disease and insect attack, consistently rising production cost, incapacity of the farming communities to deal with the dynamism of technology in cotton production, and increasing waterlogging and salinity problem. Journal: The Pakistan Development Review Pages: 1-25 Volume: 40 Issue: 1 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume1/1-25.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:1:p:1-25 Template-Type: ReDIF-Article 1.0 Author-Name: Daniel C. Hardy Author-X-Name-First: Daniel C. Author-X-Name-Last: Hardy Author-Workplace-Name: Monetary and Exchange Affairs Department, International Monetary Fund, Washington, D. C. Title: Profitability and Pricing in Treasury Bill Auctions: Evidence from Pakistan Abstract: Behaviour in the first three years of auctions for Pakistani treasury bills is studied. Bidding strategies rapidly converged to a consistent pattern after the auctions started in 1991. Factors that influenced the expected profitability of auction participation are identified. Auction participation was on average low and did not differ between types of bidders. Prices bids are found to reflect both ‘buy and sell’ and ‘buy and hold’ strategies, and were affected by risk considerations and bidder-specific variables. The Pakistani experience suggests the robustness of auctions as a market-based allocation mechanism, and their value in public debt management. Journal: The Pakistan Development Review Pages: 27-48 Volume: 40 Issue: 1 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume1/27-48.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:1:p:27-48 Template-Type: ReDIF-Article 1.0 Author-Name: Sarbajit Chaudhuri Author-X-Name-First: Sarbajit Author-X-Name-Last: Chaudhuri Author-Workplace-Name: University of Calcutta, Kolkata, India. Title: Foreign Capital Inflow, Technology Transfer, and National Income Abstract: According to Jones and Marjit (1992), in a two-sector, full-employment model it is not possible to show that growth in the foreign capital employed in the export sector of a small open economy will lead to a fall in the welfare in the presence of a protected import-competing sector. In this short paper, we have shown that one may get the immiserising result even in this framework if the inflow of foreign capital into the export sector is accompanied by technology transfer, which leads to a fall in the labour-output ratio in this sector. Journal: The Pakistan Development Review Pages: 49-56 Volume: 40 Issue: 1 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume1/49-56.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:1:p:49-56 Template-Type: ReDIF-Article 1.0 Author-Name: Soma Chowdhury Biswas Author-X-Name-First: Soma Chowdhury Author-X-Name-Last: Biswas Author-Workplace-Name: Department of Statistics at Chittagong University, Bangladesh. Author-Name: MD. Abu Darda Author-X-Name-First: MD. Abu Author-X-Name-Last: Darda Author-Workplace-Name: Department of Computer Science, Islamic University, Chittagong, Bangladesh. Author-Name: MD. Fasiul Alam Author-X-Name-First: MD. Fasiul Author-X-Name-Last: Alam Author-Workplace-Name: Department of Statistics, Chittagong University, Chittagong, Bangladesh. Title: Factors Affecting Childhood Immunisation in Bangladesh Abstract: This study has examined the coverage of childhood immunisation and tried to identify the factors affecting the acceptance of immunisation practice among children in Bangladesh using the data from Bangladesh Demographic and Health Survey (BDHS) 93-94. Results from multinomial logistic regression analysis indicate that education, occupation, household economic condition, mother’s age at birth, sex of child, mother’s TT immunisation acceptance, mother’s health facility visit, health worker’s visit to mothers, and contraceptive use are the independent variables that have statistically significant association with immunisation acceptance. The most important variable identified is the health worker’s visit to mothers. Journal: The Pakistan Development Review Pages: 57-70 Volume: 40 Issue: 1 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume1/57-70.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:1:p:57-70 Template-Type: ReDIF-Article 1.0 Author-Name: Luther G. Tweeten Author-X-Name-First: Luther G. Author-X-Name-Last: Tweeten Author-Workplace-Name: Agricultural Policy and Trade, Ohio State University, Columbus, Ohio, U.S.A. Title: Directions of U.S. Farm Programmes under a Freer Trade Environment Abstract: For the new round of WTO multilateral trade liberalisation negotiations to be successful, the world will need to be more enthusiastic and flexible about opening markets. Partisans will need to submerge their self-interests, and the U.S. will need to take the initiative for more open markets. This paper makes the case that only modest changes in the U.S. domestic grain, oilseed, and cotton programmes are needed for compatibility with global free trade. The Federal Agricultural Improvement and Reform (FAIR) Act of 1996 and related policy changes in the 1990s brought fundamental reforms compatible with freer domestic and foreign markets. Chief among these were a shift from coupled deficiency payments to decoupled direct payments, an end to supply management, and less engagement of government in commodity stock accumulation and export subsidies. Converting commodity price support to recourse loans while ending all but administrative cost subsidies to crop insurance would go far to liberalise grain, oilseed, and cotton policies. Unilateral termination of commodity programmes including direct payments totalling 42 percent of net cash farm income in year 2000 would appear to be traumatic to producers. However, reduction of direct payments could be offset (for farm income) by rising farm commodity prices and receipts resulting from (1) less farm output attending lower loan rates and crop insurance subsidies, and (2) world farm commodity price-enhancement from freer global trade. Journal: The Pakistan Development Review Pages: 89-105 Volume: 40 Issue: 2 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume2/89-105.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:2:p:89-105 Template-Type: ReDIF-Article 1.0 Author-Name: Fazal Husain Author-X-Name-First: Fazal Author-X-Name-Last: Husain Author-Workplace-Name: Pakistan Institute of Development Economics, Islamabad. Author-Name: Tariq Mahmood Author-X-Name-First: Tariq Author-X-Name-Last: Mahmood Author-Workplace-Name: Pakistan Institute of Development Economics, Islamabad. Title: The Stock Market and the Economy in Pakistan Abstract: This paper re-examines the causal relationship between stock prices and macro variables like consumption expenditure, investment spending, and economic activity (measured by GDP) in Pakistan. Using annual data from 1959-60 to 1998-99 and applying cointegration and error correction analysis, the paper indicates the presence of long-run relationship between stock prices and macro variables. Regarding the cause and effect relationship, the analysis indicates a one-way causation from macro variables to stock prices, implying that in Pakistan fluctuations in macro variables cause changes in stock prices. The findings suggest that the stock market in Pakistan is not that developed to play its due role in influencing aggregate demand. A disturbing feature of the stock market in Pakistan is that it cannot be characterised as the leading indicator of economic activity. In the absence of other strong indicators, shooting up of stock prices may indicate a speculative bubble. Journal: The Pakistan Development Review Pages: 107-114 Volume: 40 Issue: 2 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume2/107-114.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:2:p:107-114 Template-Type: ReDIF-Article 1.0 Author-Name: Abdul Ghafoor Author-X-Name-First: Abdul Author-X-Name-Last: Ghafoor Author-Workplace-Name: Institute of Social Sciences, and Faculty of Communications, Cyprus International University, Lefkosa, Mersin 10, Turkey. Author-Name: John Weiss Author-X-Name-First: John Author-X-Name-Last: Weiss Author-Workplace-Name: Bradford Centre for International Development, University of Bradford, U.K. Title: Performance of the Public Electric Power Industry: Evidence from Pakistan Abstract: The study investigates the performance of electric power sector of Pakistan at the firm level, as well as the sector as a whole. It identifies and attempts to quantify the extent of inefficiencies. Since either physical or financial or productivity indicators alone are not able to explain the duality of public infrastructure purposes and the complexity of their multi-dimensional goals, a set of relevant physical, financial, and productivity indicators have been used in evaluating the performance of this sector. Further, a Cobb- Douglas production function has also been used to calculate the trend in the growth of total factor productivity. Economies of scale have also been studied in the case of electric power generation. Journal: The Pakistan Development Review Pages: 115-133 Volume: 40 Issue: 2 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume2/115-133.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:2:p:115-133 Template-Type: ReDIF-Article 1.0 Author-Name: Shaista Alam Author-X-Name-First: Shaista Author-X-Name-Last: Alam Author-Workplace-Name: Applied Economics Research Centre, University of Karachi. Author-Name: Mohammad Sabihuddin Butt Author-X-Name-First: Mohammad Sabihuddin Author-X-Name-Last: Butt Author-Workplace-Name: Applied Economics Research Centre, University of Karachi. Title: Assessing Energy Consumption and Energy Intensity Changes in Pakistan: An Application of Complete Decomposition Model Abstract: Complete decomposition model has been employed in the present study to decompose the changes in energy consumption and energy intensity in Pakistan during 1960 to 1998. A general decomposition model raises a problem due to residual term. In some models the residual term is omitted, which causes a large estimation error, while in some models the residual term is regarded as an interaction that might create a puzzle for the analysis. A complete decomposition model is used here to solve this problem. Journal: The Pakistan Development Review Pages: 135-147 Volume: 40 Issue: 2 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume2/135-147.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:2:p:135-147 Template-Type: ReDIF-Article 1.0 Author-Name: Zafar Mahmood Author-X-Name-First: Zafar Author-X-Name-Last: Mahmood Author-Workplace-Name: Institute for Scientific Research. Author-Name: Mohammad Azhar Author-X-Name-First: Mohammad Author-X-Name-Last: Azhar Author-Workplace-Name: Pakistan Institute of Development Economics, Islamabad. Title: On Overinvoicing of Exports in Pakistan Abstract: Whereas the policy incentives were designed to promote exports from Pakistan, the incentive system instead led to illicit export practices, i.e., export overinvoicing due to the weaknesses of implementation. Such practices resulted in a significant financial loss to the country and undermined the effectiveness of the export-promoting policy. This paper has determined the presence of overinvoicing of exports in Pakistan and the geographic and product-wise patterns in export overinvoicing. The paper has applied the ‘partner-country data comparison’ technique. Empirical findings confirm the strong presence of export overinvoicing across trading partner countries and products. This conclusion is further supported by the evidence of a significant difference between the duty-drawback rate and the premium on foreign exchange in the kerb market. Convincing presence of export overinvoicing is the basis for a set of policy recommendations made in the paper. Journal: The Pakistan Development Review Pages: 173-185 Volume: 40 Issue: 3 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume3/173-185.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:3:p:173-185 Template-Type: ReDIF-Article 1.0 Author-Name: Abedullah Author-Workplace-Name: University of Rostock, Germany. Author-Name: Mubarak Ali Author-X-Name-First: Mubarak Author-X-Name-Last: Ali Author-Workplace-Name: Asian Vegetable Research and Development Center (AVRDC), Taiwan. Title: Wheat Self-sufficiency in Different Policy Scenarios and Their Likely Impacts on Producers, Consumers, and the Public Exchequer Abstract: Every government faces a challenge to select an optimum policy to provide food supplies to the consumers at a reasonable price and maintain a reasonable nutritional standard. The alternative policy options available are an uninterrupted market, imports, input subsidies, price support, combined policy developed by the combination of input subsidy and price support, and investment on research and infrastructure development. This paper analyses the impact of these options on consumers’ and producers’ welfare, tax revenue, and foreign exchange requirement. The import and input subsidy give net return to the society while price support generates net loss. The triple combined policy option generates the highest net return to the society when each import and input subsidy component is combined with price support in the ratio of 40 and 20 percent, respectively. The best policies to provide higher wheat supplies at lower prices and to improve the welfare of consumers and producers were investment on agricultural research and development of irrigation infrastructure in the long run, but for the short run, the first and the second best option were respectively the combined and the input subsidy policy. Journal: The Pakistan Development Review Pages: 203-223 Volume: 40 Issue: 3 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume3/203-223.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:3:p:203-223 Template-Type: ReDIF-Article 1.0 Author-Name: Sarbajit Chaudhuri Author-X-Name-First: Sarbajit Author-X-Name-Last: Chaudhuri Author-Workplace-Name: Department of Economics, University of Calcutta. Title: Foreign Capital Inflow, Non-traded Intermediary, Urban Unemployment, and Welfare in a Small Open Economy: A Theoretical Analysis Abstract: The paper attempts to analyse the implications of foreign capital inflow in a small open economy with a non-traded intermediary on the welfare and urban unemployment in a three-sector Harris-Todaro (1970) framework. The standard immiserising result of a foreign capital inflow has been found to be valid when the non-traded intermediary is solely used in the protected import-competing sector. However, if the export sector too uses the intermediary, the economy may experience an improvement in its welfare and a reduction in the urban unemployment level. Journal: The Pakistan Development Review Pages: 225-235 Volume: 40 Issue: 3 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume3/225-235.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:3:p:225-235 Template-Type: ReDIF-Article 1.0 Author-Name: A. R. Kemal Author-X-Name-First: A. R. Author-X-Name-Last: Kemal Author-Workplace-Name: Pakistan Institute of Development Economics, Islamabad. Title: Debt Accumulation and Its Implications for Growth and Poverty Abstract: Rising levels of debt and debt servicing, falling rates of investment, declining growth rates of output and employment, and sharp increase in poverty sum up the disappointing performance of Pakistan’s economy over the last decade. By the end of the fiscal year 2001, external debt had increased to $30 billion, and the ratio of external debt and the present value of debt servicing stood at 64.0 and 80.0 percent of GDP respectively. Even though the ratio of debt servicing to export earnings and debt servicing to total foreign exchange earnings have declined because of debt rescheduling, still they were 37.4 and 23.3 percent, respectively, in 2000-01. Prior to debt rescheduling, the two ratios were 55.4 and 34.9 percent in 1997-98. The average growth rate of GDP has been less than 4 percent, with a declining trend, and unemployment rate has increased from less than 5 percent to 7.8 percent over the last decade. The real wages have fallen, and one-third of the population is unable to meet its nutritional requirements. While a number of factors including the inconsistency of the economic policies of successive governments, Structural Adjustment and Stabilisation Programmes of the IMF, and corruption have been responsible for this state of affairs, debt accumulation to alarming proportions is also a major cause of such performance. Journal: The Pakistan Development Review Pages: 263-281 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/263-281.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:263-281 Template-Type: ReDIF-Article 1.0 Author-Name: Robert A. Mundell Author-X-Name-First: Robert A. Author-X-Name-Last: Mundell Author-Workplace-Name: Columbia University, New York. Title: Debt, Growth, and Poverty in the International Monetary System Abstract: This paper explores the relationship between debt, growth, and poverty and the international monetary system. With a well-functioning international monetary system, economic policy works well, instruments are assigned to targets appropriately, and discipline is maintained. The fixed exchange rate is contrasted with alternative monetary rules. The monetary rule is the weakest system; monetary targeting has failed in every country in which it has been tried. An advantage of the fixed exchange rate is the clue it provides to the price level, interest rate, and future monetary policy. Other things being equal, the use of a currencies basket is inferior to a single currency peg, while a freely floating exchange rate system puts itself at the mercy of speculators. The paper points out the conditions for a successful currency area as a consensus on a common inflation rate; a common basket of goods with which to measure inflation; exchange rate that must be locked; member countries must adopt a common monetary policy; and a formula must be devised for distributing and using the seigniorage profits from monetary expansion. There is a need to study the possibility of an Asian currency area and the links between the APEC and the SAARC. Regular and mutual surveillance on monetary, fiscal, and exchange rate convergence, and policies that minimise exchange rate uncertainty and work towards a currency club area based on a common anchor— initially the dollar—are needed. Setting up of an Asian Monetary Fund is also suggested, one that is closely modelled on the original IMF articles of agreement and will provide an anchored fixed exchange rate system. Journal: The Pakistan Development Review Pages: 283-314 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/283-314.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:283-314 Template-Type: ReDIF-Article 1.0 Author-Name: Peter Nunnenkamp Author-X-Name-First: Peter Author-X-Name-Last: Nunnenkamp Author-Workplace-Name: Kiel Institute for World Economics, Germany. Title: Why Economic Growth Trends Differ So Much across Developing Countries in the Era of Globalisation Abstract: The claim of globalisation critics that the income gap with industrial countries is bound to widen for essentially all developing countries as a consequence of economic globalisation is in conflict with empirical evidence. Economic performance differs tremendously across developing countries. We discuss several factors such as capital accumulation, openness to trade, and foreign indebtedness which may explain the varying experience with globalisation in regard to per capita income growth and income distribution. Economic restructuring is shown to represent an important—though frequently neglected—link between globalisation and country-specific performance. We conclude that national policy-makers continue to have effective leverage to promote economic catching-up and poverty alleviation in the countries they govern. Journal: The Pakistan Development Review Pages: 315-343 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/315-343.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:315-343 Template-Type: ReDIF-Article 1.0 Author-Name: Fakhari A. Siddiqui Author-X-Name-First: Fakhari A. Author-X-Name-Last: Siddiqui Author-Workplace-Name: Williams School of Business and Economics, Bishop’s University, Canada. Title: Importance of a Population Policy in Pakistan Abstract: The primary purpose of this lecture is to make a case for an integrated and effective population policy in Pakistan. An effective population policy is critical in its own right. It is also essential for maximising the positive outcome of all of Pakistan’s development efforts. Despite some very modest progress, the overall population growth rate is still so high that it warrants serious concern. Among the top ten contributors to world population growth during 1995–2000, Pakistan stood third in absolute number, and was Number One in rate of growth. The average total fertility rate per woman of 5.2 in Pakistan, as compared to 2.4 in Indonesia, 2.9 in Iran, and 3.1 in India, is indeed problematic and requires an appropriate policy response. A broader view of population growth and economic development is suggested instead of a narrow family planning focus. Thus family planning programmes (supply-side) would be effective only when the population at large has the desire or motivation for smaller families (demand-side). It is shown that the demand-side of the equation is influenced by a host of social, cultural, religious, educational, and other factors. For purposes of this paper, all these are taken together and termed the knowledge factor. It is suggested that a successful population policy must have a clear focus on increasing the knowledge factor in the country through education and advocacy. Based on the policy experiences of other developing countries and the recent demographic realities in Pakistan, an effective population policy must address the following three objectives: (a) reduction in the rate and incidence of unwanted fertility; (b) reduction in demand for large-size families; and (c) greater investment in adolescents to tackle the population momentum problem. The lecture concludes that Pakistan still has a population problem that it must deal with by a comprehensive and effective population programme. Failure to do so would magnify the current problems which are a result of previous policy neglect. Journal: The Pakistan Development Review Pages: 345-369 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/345-369.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:345-369 Template-Type: ReDIF-Article 1.0 Author-Name: John W. Mellor Author-X-Name-First: John W. Author-X-Name-Last: Mellor Author-Workplace-Name: Abt Associates, Inc., Washington, D. C. Title: Employment Multipliers from Agricultural Growth and Poverty Reduction Abstract: Poverty is still a major problem in Pakistan. Worse, the excellent progress made in poverty reduction in the 1970s and 1980s has been reversed in the 1990s. That is the bad news. The good news is that Pakistan is unusually well placed to return to rapid reduction in poverty. We have long known that agricultural growth is closely related to poverty reduction. Recent studies by Peter Timmer and by Martin Ravallion and their colleagues provide massive statistical evidence of this relationship. Rural growth and agricultural growth have a major effect on poverty reduction; urban growth and manufacturing growth do not. At first glance that is strange because farmers are not the poorest rural people, and the direct benefits from agricultural growth are distributed roughly proportionately to size of landholding. The poor in rural areas are heavily concentrated in the rural non-farm sector. They produce non-tradable goods and services. That is, local demand is essential to their growth. It is rising agricultural incomes that provide that growth in local demand. Thus, agriculture’s massive impact on poverty is indirect, working through expenditures on the rural non-farm sector. The bulk of those expenditures are for consumption goods. Pakistan has unusually productive resources that are highly responsive to the favourable forces of globalisation and technological change. In the 1970s and 1980s the agriculture of Pakistan grew at better than four percent per year, sufficient to reduce poverty levels rapidly. To return to those growth rates requires several public actions. Institutional reform in the irrigation system needs to reverse the losses that have occurred from poor management. There must be increased expenditure on the agricultural research and extension systems and that expenditure must be subject to a few priorities and increased efficiency. The rural road and education systems need to be massively expanded. Much more emphasis needs to be placed on expansion of the high value horticultural sector for which Pakistan has a strong comparative advantage in international markets. Those actions can be expected to bring a return to high growth rates in the four to six percent range and a resumption of rapid decline in poverty and its virtual elimination in a ten to twenty year period. Journal: The Pakistan Development Review Pages: 371-400 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/371-400.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:371-400 Template-Type: ReDIF-Article 1.0 Author-Name: Anita M. Weiss Author-X-Name-First: Anita M. Author-X-Name-Last: Weiss Author-Workplace-Name: University of Oregon, Eugene, USA. Title: Social Development, the Empowerment of Women, and the Expansion of Civil Society: Alternative Ways out of the Debt and Poverty Trap Abstract: In Pakistan’s fifty-five years, most governments have terribly neglected the overall well-being of their people. When economic growth has occurred in the past, it has been grossly inequitable. For Pakistan to escape the debt and poverty trap in which it is becoming inextricably immersed, it must prioritise social development, the empowerment of women, and the expansion of civil society over economic growth strategies. Only then can there be balanced growth—not just growth for the élites—as knowledgeable people from myriad backgrounds feel vested in Pakistan’s future. The process of globalisation has all but eliminated the possibility of a local economy being able to become competitive in the global market. Though by prioritising social development, enabling women to become full participants in the state, and expanding the power and possibilities that civil society groups can play, Pakistan will find that these are the most viable strategies to break free from the debt and poverty trap in which it finds itself today. Journal: The Pakistan Development Review Pages: 401-432 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/401-432.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:401-432 Template-Type: ReDIF-Article 1.0 Author-Name: Sabur Ghayur Author-X-Name-First: Sabur Author-X-Name-Last: Ghayur Author-Workplace-Name: Institutional and External Relations, International Confederation of Free Trade Unions, Asian and Pacific Regional Organisation, Singapore. Title: IFIs’ Conditionalities, Poverty Reduction, and Employment Abstract: the great depression of 1930s, the Bretton Woods twins—international monetary fund (IMF) and the world bank; rather the world bank group1—have over the years emerged as important players of the international financial arena. They are the major component of international financial architecture in addressing global macro and financial stability. The Bank together with the regional multi-lateral development banks (MDBs), such as the Asian Development Bank (ADB) for the Asian and the Pacific region, is making its contribution in building necessary infrastructure needed to initiate and support the development process, the recent reduced emphasis on such projects notwithstanding. Journal: The Pakistan Development Review Pages: 435-451 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/435-451.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:435-451 Template-Type: ReDIF-Article 1.0 Author-Name: Kaiser Bengali Author-X-Name-First: Kaiser Author-X-Name-Last: Bengali Author-Workplace-Name: Social Policy and Development Centre (SPDC), Karachi. Author-Name: Qazi Masood Ahmed Author-X-Name-First: Qazi Masood Author-X-Name-Last: Ahmed Author-Workplace-Name: the Institute of Business Administration (IBA), University of Karachi, and Social Policy and Development Centre (SPDC), Karachi. Title: Stabilisation Policy vs. Growth-oriented Policy: Implication for the Pakistan Economy Abstract: Pakistan has initiated a comprehensive reforms efforts aiming at tracking the economy on a higher and sustainable economic growth, reduce level of poverty, reducing unemployment, raising their level of standard of living. These objective were to be achieved through a programme that would build on the macro-economic stability which encompasses structural reforms, trade liberalisation, privatisation, fiscal reforms and financial sector. This paper makes one of the early attempt to analyse the Pakistan stabilisation experiences. In Pakistan the stabilisation programme was started in 1988-89. In this paper we mainly examine the fiscal and monetary policy package since 1988 when the Pakistan committed to a set of conditionalities under the Structural Adjustment Programme of the IMF. The fundamental question that has risen was the relative efficacy of stabilisation oriented versus growth oriented policies on development and welfare. Admittedly, stabilisation and growth are not mutually exclusive and any policy package has to incorporate both the elements. However, the manner in which the policy has been implemented in Pakistan has tended to pursue stabilisation at the expense of growth. Journal: The Pakistan Development Review Pages: 453-466 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/453-466.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:453-466 Template-Type: ReDIF-Article 1.0 Author-Name: Levent Koch Author-X-Name-First: Levent Author-X-Name-Last: Koch Author-Workplace-Name: Suleyman Demirel University, Almaty, Kazakhstan. Author-Name: M. A. Chaudhary Author-X-Name-First: M. A. Author-X-Name-Last: Chaudhary Author-Workplace-Name: Suleyman Demirel University, Almaty, Kazakhstan. Title: February 2001 Crisis in Turkey: Causes and Consequences Abstract: Turkey has suffered from different economic crises since 1990. However, the February 2001 crisis has been unprecedented in intensity and repercussions. Although many factors, both internal and external, may have contributed to their occurrences, the former owing to their inducing corruption and waste in the economy, seem to have fomented them more than the latter. Although Turkey has been getting transformed into a market economy since 1980, government intervention is still pervasive in its economy. Government still controls Central Bank, owns commercial banks, and operates public enterprises. It has liberalised market, currency, foreign trade and foreign direct investment (FDI), but still operates sectors like energy, sugar and tobacco. Such a level of state intervention had adverse implications for corruption, waste, effective reforms, etc. in the country. Further, since the transformation of the economy could not be accompanied by concomitant structural, legal and institutional reforms in 1990s, resources have constantly been misused over the years. Further still, groups owning bank, media and holding companies jointly have notoriously precipitated domestic financial crisis by stashing away the home deposits in their offshore branches. Finally, supporting agriculture and industry with politically-motivated credit for voting purposes has constantly been aggravating the drain of resources and thereby financial crises of the country. This paper attempts a critical examination of how such factors may have contributed to the occurrence and accentuation of economic crises suffered by Turkey over the last decade. Journal: The Pakistan Development Review Pages: 467-486 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/467-486.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:467-486 Template-Type: ReDIF-Article 1.0 Author-Name: M. Ghaffar Chaudhry Author-X-Name-First: M. Ghaffar Author-X-Name-Last: Chaudhry Author-Workplace-Name: Pakistan Institute of Development Economics, Islamabad. Title: Theory of Optimal Taxation and Current Tax Policy in Pakistan’s Agriculture Abstract: public finance into the mould of classical welfare economics by emphasising minimisation of dead weight losses resulting from the imposition of a tax or faulty tax structure. As such, these modern theories have much in common with the traditional approach in terms of efficiency and equity. In spite of this, however, the differences remain. For example, the former theories adhere strictly to the norms of classical welfare economics which treats individual consumers as utility maximisers where improvements in welfare involve change that makes one individual better-off without making someone else worse-off [Stern (1987)]. In contrast to the emphasis of traditional theories on lump-sum taxes, the optimum tax literature is concerned with the implication of using non-lump-sum taxes which have a wider range and therefore more useful to the policy-maker. The recent work on normative tax theory looks at the impact of taxation on individual decisions and the trade off between raising revenues or redistributing tax burdens and the efficiency losses [Atkinson (1987)]. Finally, the optimal tax literature may be more pragmatic in its approach than traditional works as it realistically deals with government objectives and constraints and combines them into models that are sufficiently rich to allow for differences between people regarding income and expenditure patterns. Journal: The Pakistan Development Review Pages: 489-502 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/489-502.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:489-502 Template-Type: ReDIF-Article 1.0 Author-Name: Mahnaz Fatima Author-X-Name-First: Mahnaz Author-X-Name-Last: Fatima Author-Workplace-Name: Institute of Business Administration (IBA), Author-Name: Qazi Masood Ahmed Author-X-Name-First: Qazi Masood Author-X-Name-Last: Ahmed Author-Workplace-Name: Institute of Business Administration, University of Karachi, and Social Policy and Development Centre (SPDC), Karachi. Title: Political Economy of Fiscal Reforms in the 1990s Abstract: Throughout the decade of the 1990s, major emphasis in Pakistan remained on fiscal reform as a part of the reform programmes undertaken by the various governments of Pakistan. Fiscal reform assumes significance considering the high budget deficits that Pakistan has been experiencing. These have added to Pakistan’s total debt burden in general and external debt in particular. Increase in the burden of debt adds to debt-servicing expenditure which further feeds back into the issue of high fiscal deficit. Debt-servicing increased to almost 47 percent1 by the middle of the decade of 1990s and comprised 8.3 percent of the GDP, up from less than 1 percent mid-1960s. Pakistan’s external debt at over $32 billion2 in 1998 was 41 percent of its GNP which was amongst the highest in the South Asian region with India’s at 20 percent of GNP in the same year and Sri Lanka’s also at 41 percent3 of its GNP. In this paper, we attempt to explore the rationale behind the emphases on the improvement in both the deficit-to-GDP and the tax-to-GDP ratios that have remained the cornerstones of Pakistan’s fiscal reform effort in the decade of the 1990s. Section 2 is a discussion of the extent of successes and failures of the fiscal reform effort thus far and explores the relationship between tax generation and budget deficit. Section 3 discusses the impact of expenditures on budget deficit. Section 4 shows the rise in dependence on external sources of financing. Section 5 gives the conclusions. Journal: The Pakistan Development Review Pages: 503-518 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/503-518.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:503-518 Template-Type: ReDIF-Article 1.0 Author-Name: Nasim Shah Shirazi Author-X-Name-First: Nasim Shah Author-X-Name-Last: Shirazi Author-Workplace-Name: Kulliyyah of Economics and Management Sciences, International Islamic University, Malaysia. Author-Name: Muhammad Ilyas Author-X-Name-First: Muhammad Author-X-Name-Last: Ilyas Author-Workplace-Name: Allama Iqbal Open University, Islamabad. Author-Name: Mehboob Ahmad Author-X-Name-First: Mehboob Author-X-Name-Last: Ahmad Author-Workplace-Name: Allama Iqbal Open University, Islamabad. Title: Redistributive Effects of Fiscal Policy across the Income Groups in the Urban-Rural Areas of Pakistan Abstract: There exist a large number of studies related to the estimates of government budgetary redistributive effects and its related problems with regard to different countries of the world.1 Studies of the impacts of government expenditures and taxes in Pakistan have been conducted within the framework of either incidence of taxes or the impact of expenditures across the income groups. The studies carried out by Azfar (1972); Jeetun (1978); Alauddin and Raza (1981) Malik and Saqib (1985, 1989) cover different aspects of taxation—tax incidence, progressivity or regressivity of the tax system across the income groups/individuals and regions. These studies did not discuss the expenditure side of the budget. Shirazi (1996) analysed the impact of government transfer programmes (Zakat and Ushr) across the income deciles. Ghaus (1989) studied the incidence of provincial and municipal government service-related expenditure benefits in Karachi metropolitan and therefore, the scope of her study was limited to one city only. Despite the existence of a rich bibliography on the subject of government redistrbutive budgetary effects and its related problems, no study is available which covers the overall redistributive impacts of government budgetary policy in Pakistan. This study explores the impacts of government expenditures and taxes on the distribution of income across various income groups along with net fiscal impacts in the urban-rural areas of Pakistan. The rest of our study is organised as follows. In the following section, Part II, we describe the methodology and data set. In Part III, the results of the study are presented. The Part IV concludes the paper. Journal: The Pakistan Development Review Pages: 519-533 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/519-533.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:519-533 Template-Type: ReDIF-Article 1.0 Author-Name: Syed Mubashir Ali Author-X-Name-First: Syed Mubashir Author-X-Name-Last: Ali Author-Workplace-Name: Pakistan Institute of Development Economics, Islamabad. Author-Name: Jafar Hussain Author-X-Name-First: Jafar Author-X-Name-Last: Hussain Author-Workplace-Name: Pakistan Institute of Development Economics, Islamabad. Title: Fertility Transition in Pakistan: Evidence from Census Abstract: In the absence of an accurate and complete registration system, efforts were made to estimate the levels of vital statistics through sample surveys. The first such effort was made through the Population Growth Estimation (PGE) project conducted from January, 1962 to December 1965. Later on, various demographic surveys were conducted almost at regular intervals and the last effort in the series was Pakistan Reproductive Health and Family Planning Survey (PRHFPS) in the year 2000-01. Although all these efforts were made to ascertain levels and trends of various demographic events, yet the estimates particularly the ones on fertility remained controversial. The first signal of fertility reduction was emanated from the 1975 Pakistan Fertility Survey (PFS) which estimated a Total Fertility Rate (TFR) of 6.3 children from over 7 children estimated earlier from PGE data. However, all hopes of the onset of fertility transition were shattered by the [Retherford’s, et al. (1987)] study entitled “Fertility Trend in Pakistan: The Decline that Wasn’t”. By using the Own Children Method, they confirmed that the decline in fertility was an artifact of the data. Another study by Shah, Pullum, and Irfan (1986) also termed the fertility decline shown by the PFS data as spurious. The Pakistan Labour Force and Migration Survey, conducted five years later, in 1979-80, estimated a TFR of 6.5 children, thus providing another proof supporting the fact that fertility had not declined to the extent believed. Journal: The Pakistan Development Review Pages: 537-550 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/537-550.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:537-550 Template-Type: ReDIF-Article 1.0 Author-Name: Abdul Hakim Author-X-Name-First: Abdul Author-X-Name-Last: Hakim Author-Workplace-Name: National Institute of Population Studies, Islamabad. Title: Population Policy Shifts and Their Implications for Population Stabilisation in Pakistan Abstract: The visible fast increase in the growth rate of world population occurred during the second half of the twentieth century due to the faster declines in mortality following the medical and public health advances made around the time of World War II. The global population growth rate after peaking of at around 1.7 to 1.9 percent per annum in the 1970s and 1980s has since started declining and is currently around 1.4 percent per annum. The world population more than doubled, recording 142 percent increase, from 2.51 billion in 1950 to around 6.07 billion in 2000 [Hakim (2000)]. Most of the increase has been in less developed countries, from 1.68 billion in 1950 to 4.88 billion in 2000, recording 190 percent. Compared to this, the more developed countries witnessed only a marginal increase of 43 percent from 0.83 billion in 1950 to 1.19 billion population in 2000. Journal: The Pakistan Development Review Pages: 551-573 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/551-573.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:551-573 Template-Type: ReDIF-Article 1.0 Author-Name: Shaista Alam Author-X-Name-First: Shaista Author-X-Name-Last: Alam Author-Workplace-Name: Applied Economics Research Centre, University of Karachi. Author-Name: Muhammad Sabihuddin Butt Author-X-Name-First: Muhammad Author-X-Name-Last: Sabihuddin Butt Author-Workplace-Name: Applied Economics Research Centre, University of Karachi. Author-Name: Azhar Iqbal Author-X-Name-First: Azhar Author-X-Name-Last: Iqbal Author-Workplace-Name: Applied Economics Research Centre, University of Karachi. Title: The Long-run Relationship between Real Exchange Rate and Real Interest Rate in Asian Countries: An Application of Panel Cointegration Abstract: The role of exchange rate policy in economic development has been the subject of much debate and controversy in the development literature. Interest rates and exchange rates are usually viewed as important in the transmission of monetary impulses to the real economy. In the short run the standard view of academics and policy-makers is that a monetary expansion lowers the interest rate and rises the exchange rate, with these price changes then affecting the level and composition of aggregate demand. Frequently, these influences are described as the liquidity effects of monetary expansion, viewed as the joint effect of providing larger quantities of money to the private sector. Popular theories of exchange-rate determination also predict a link between real exchange rates and real interest rate differentials. These theories combine the uncovered interest parity relationship with the assumption that the real exchange rate deviates from its long-run level only temporarily. Under these assumptions, shocks to the real exchange rate—which are often viewed as caused by shocks to monetary policy—are expected to reverse themselves over time. This study investigates the long-run relationship between real exchange rates and real interest rate differentials using recently developed panel cointegration technique. Although this kind of relationship has been studied by a number of researchers,1 very little evidence in support of the relationship has been reported in the case of developing countries. Journal: The Pakistan Development Review Pages: 577-602 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/577-602.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:577-602 Template-Type: ReDIF-Article 1.0 Author-Name: Syed Fawad Ali Rizvi Author-X-Name-First: Syed Fawad Author-X-Name-Last: Ali Rizvi Author-Workplace-Name: Arshad Zaman Associates (Pvt.) Ltd., Karachi. Title: Post-liberalisation Efficiency and Productivity of the Banking Sector in Pakistan Abstract: It has been long debated in economic literature whether financial markets play a significant role in economic growth and development. [For review see Gertler (1988) and Levine (1997)]. Findings of some recent empirical literature show that well-functioning financial system plays an instrumental role in economic growth, and the causality runs from finance to growth [for cross country evidences see King and Levine (1993, 1993a); Levine and Zervos (1998); Levine, Loayza and Beck (1999); Beck, Levine, and Loayza (1999)]. This, in turn, has led to a search for the key factors that determine the better functioning financial markets. Within the banking sector, efficiency is the core concern of both academics and bank officials. A number of studies have sought to measure the efficiency of financial institutions, to identify the factors that contribute to efficiency of financial system, and to recommend the ways to attain the peer group efficiency levels [Berg (1993); Leaven (1999); Berger and Mester (1997); Miller and Noulas (1996)]. These empirical findings suggest a healthy competitive financial market pave the way for efficient market participants that leads to overall efficiency of the system and hence productivity. Following this notion, liberalisation of financial markets has been initiated to improve the performance of financial institutions both in developed and developing countries. Some empirical tests have been carried out to measure the effects of liberalisation and deregulation of financial institutions on the efficiency and productivity of banking sector. Journal: The Pakistan Development Review Pages: 605-632 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/605-632.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:605-632 Template-Type: ReDIF-Article 1.0 Author-Name: Kalim Hyder Author-X-Name-First: Kalim Author-X-Name-Last: Hyder Author-Workplace-Name: Social Policy and Development Centre, Karachi. Title: Crowding-out Hypothesis in a Vector Error Correction Framework: A Case Study of Pakistan Abstract: Under the umbrella of the IMF stabilisation programmes, Pakistan has pursued a policy of fiscal consolidation since 1988. A look at the budget deficit from 1988 onwards reveals that the policy has only been marginally successful. Even this fragile accomplishment of the Fund-based programme has been achieved at a much greater cost: the reduction in budget deficit has only been materialised because of the curtailment of development expenditure component of total fiscal outlays [Social Policy and Development Centre (2001)]. Economic theory suggests that development expenditure component of fiscal outlays, which also equals net investment by the public sector,1 has a significant relationship with both the rate of private investment and economic growth. If public investment increases, fewer funds will be available for private investment. Competition will thereby drive the interest rates up leading to lower level of private investment. Neo-classicals believe that this process will only result in a redistribution of gross national between the public and the private sector and the rate of economic growth will remain intact. On the other hand, Keynesians argue that the multiplier effect of higher public spending will be larger as compared to the induced negative effect of reduced private investment on the rate of economic activity and, therefore, gross national product will increase. Journal: The Pakistan Development Review Pages: 633-650 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/633-650.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:633-650 Template-Type: ReDIF-Article 1.0 Author-Name: Salman Syed Ali Author-X-Name-First: Salman Author-X-Name-Last: Syed Ali Author-Workplace-Name: International Islamic University, Islamabad. Author-Name: Khalid Mustafa Author-X-Name-First: Khalid Author-X-Name-Last: Mustafa Author-Workplace-Name: University of Karachi. Title: Testing Semi-strong Form Efficiency of Stock Market Abstract: The efficient market hypothesis suggests that stock markets are “informationally efficient”. That is, any new information relevant to the market is spontaneously reflected in the stock prices. A consequence of this hypothesis is that past prices cannot have any predictive power for future prices once the current prices have been used as an explanatory variable. In other words the change in future prices depends only on arrival of new information that was unpredictable today hence it is based on surprise information. Another consequence of this hypothesis is that arbitrage opportunities are wiped out instantaneously. Empirical tests of the efficient market hypothesis actually test for these consequences in various ways. Some of them have been summarised in earlier chapters. These tests generally could not conclusively accept the random-walk hypothesis of stock returns even when GARCH effects were accounted for. Many studies have found empirical regularities that are contrary to the efficient market hypothesis. For example, the monthly, weekly and daily returns on stocks tend to exhibit discernable patterns, such as seasonal affects, month of the year affect, day of the week affect, hourly affect etc. In case of Pakistan’s stock markets too such affects are identified. Such as the Ramadan affect [see Hussain and Uppal (1999)], seasonal effects and day of the week affect. Further, the wide spread use of “technical analysis” among stock traders and their ability to predict to some extent the direction of movements in the prices of individual stocks over medium term testifies to the existence of patterns and seasonal trends. Journal: The Pakistan Development Review Pages: 651-674 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/651-674.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:651-674 Template-Type: ReDIF-Article 1.0 Author-Name: Rehana Siddiqui Author-X-Name-First: Rehana Author-X-Name-Last: Siddiqui Author-Workplace-Name: Pakistan Institute of Development Economics, Islamabad. Author-Name: Afia Malik Author-X-Name-First: Afia Author-X-Name-Last: Malik Author-Workplace-Name: Pakistan Institute of Development Economics, Islamabad. Title: Debt and Economic Growth in South Asia Abstract: After 1980s, in most developing countries, the rate of debt accumulation and increase in debt servicing are highlighted as major factors affecting the growth rate of output. Most of these countries lost their competitiveness in the international market mainly as a result of insufficient exchange rate adjustments. In addition, the weakening of terms of trade, economic mismanagement and crisis of governance also lowered growth rates in the developing countries. The downward pressure was larger in the countries facing higher debt burden as these countries faced higher interest rates, decline in the external resource inflow, lower export earnings, lower domestic output and lower imports. In case of South Asian countries, the external debt scenario has changed over time. According to World Bank (2001) Pakistan’s ranking worsened to ‘severely-indebted low income country’ from ‘moderately-indebted low income country’ in 1997, where as India’s ranking improved to ‘less indebted low income’ country from ‘moderately indebted’ in 1997. The rapid accumulation of debt, rising repayment burden and the economically and politically resource inflow or rescheduling motivated rescheduling of debt (as in case of Pakistan) has raised concerns regarding the impact of debt on the growth process of the South Asian countries. Khanobis and Bari (2001) claim that foreign resource inflow increased the resource availability and as a result it contributed to economic growth in South Asia. However, the study does not examine the effect of debt accumulation on economic growth. In this paper, given the diversity of growth experience, we examine the impact of rising debt burden on economic growth of South Asian countries. Journal: The Pakistan Development Review Pages: 677-688 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/677-688.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:677-688 Template-Type: ReDIF-Article 1.0 Author-Name: Rizwana Siddiqui Author-X-Name-First: Rizwana Author-X-Name-Last: Siddiqui Author-Workplace-Name: Pakistan Institute of Development Economics, Islamabad. Author-Name: Rehana Siddiqui Author-X-Name-First: Rehana Author-X-Name-Last: Siddiqui Author-Workplace-Name: Pakistan Institute of Development Economics, Islamabad. Title: Determinants of Debt Rescheduling in Pakistan Abstract: Pakistan’s total debt has reached to 115 percent of GDP in 2001 [Pakistan (2001)]; per capita debt exceeded per capita GDP. The outstanding stock of public debt was roughly 400 percent of government revenue in 1980 and it increased to 624 percent by mid-2000 [Pakistan (2001)]. It is the only country in South Asia, classified as “severely indebted low-income country” by the World Bank (2001). Debt servicing is more problematic than debt. It has been 2.5 percent of GNP during seventies and increased to 3.5 percent of GNP during eighties. In 2001, debt servicing consumes more than seventy percent government revenue and leaves less than thirty percent for every thing else [The News (2001)]. This increase in debt and debt servicing has affected creditworthiness of the country and raised the concern about its future growth prospects. The deterioration in all the indicators, like debtexport ratio, debt-GDP ratio, debt servicing to GDP ratio etc. raised the risk of default and increased vulnerability of the country to external and internal shocks. One possible way out is the rescheduling of debt to minimise total loss to creditor countries as well as subside the burden of debtor country. Pakistan’s debt has been rescheduled many times during the last thirty years. Journal: The Pakistan Development Review Pages: 689-704 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/689-704.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:689-704 Template-Type: ReDIF-Article 1.0 Author-Name: M. Aslam Chaudhary Author-X-Name-First: M. Aslam Author-X-Name-Last: Chaudhary Author-Workplace-Name: Quaid-i-Azam University, Islamabad. Author-Name: Sabahat Anwar Author-X-Name-First: Sabahat Author-X-Name-Last: Anwar Author-Workplace-Name: Fatima Jinnah Women’s University, Rawalpindi. Title: Debt Laffer Curve for South Asian Countries Abstract: The inflow of foreign capital is generally seen as an accelerating force to economic growth, due to provision of additional resources, and these funds are considered complementary to local savings. It could also help to transfer technology and, therefore, increase productivity. Besides it enhances purchasing power of the recipients [Mullick (1988)] and as a result stimulates growth. The purpose of foreign debt is to increase real transfer of resources from the developed countries to the developing countries, so that these countries could pick up momentum of economic growth and as a result improve their welfare. The rapid increase in the external debt obligations of the developing countries, during the 1970s, had given rise to concerns about the dangers of increasing trend in interest and amortisation payments and, therefore, this situation posed a threat to debtor countries. The foreign debt of the developing countries has become a threat to their economic growth. The debt servicing of some of the LDC’s exceeded to their growth rates.2 Initially, most analysts believed that debt servicing problem would be temporary. It was hoped that creditworthiness and more normal growth of most of the countries would be restored with the influx of foreign resources. However, the debt crises have demonstrated that this assessment was optimistic and seemed never to be realised. Journal: The Pakistan Development Review Pages: 705-720 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/705-720.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:705-720 Template-Type: ReDIF-Article 1.0 Author-Name: Seemi Waheed Author-X-Name-First: Seemi Author-X-Name-Last: Waheed Author-Workplace-Name: Pakistan Administrative Staff College, Lahore. Title: Analysis of Issues on Micro Credit—The Case of Two Villages in Punjab Abstract: The phenomenon of poverty was felt and observed more during the decade of 1990s, as the overall growth slowed down. While the slowed economic growth and recessionary trends contributed to poverty, the trickle “down effect” once thought, to improve living conditions, did not reach the lowest level owing largely to lack of accessibility of institutions, unjust and non-poor policies. For these reasons, in Pakistan during the decades of 60s and 80s, when the country experienced high growth rates of 6-7 percent, 34 percent of people still lived below the poverty line. Socio-economic development, improving the quality of life in general and of rural poor in particular, welfare have been the prime stated goals of government. Therefore, rural development programmes, such as, Village-Aid, Integrated Rural Development Programme (IRDP), Peoples Works Programme, Tameer-e-watan Programme, Prime Minister’s Five Points Programme etc. were introduced to improve farm productivity, which would consequently improve incomes and quality of life of rural poor. This was done through the Department of Local Government and Rural Development. Little impact on the life of the rural poor, however, was observed partly because these were administered through closed, immutable and cloistered institutions of government which are not accessible and responsive to the needs of poor. Also, the lack of focus on community participation and need for it was evident. As these programmes were managed through government departments these lacked flexibility and out-reach. The approach of administering was fixed, rigid and lacked professionalism. Journal: The Pakistan Development Review Pages: 723-750 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/723-750.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:723-750 Template-Type: ReDIF-Article 1.0 Author-Name: Muhammad Iqbal Author-X-Name-First: Muhammad Author-X-Name-Last: Iqbal Author-Workplace-Name: Pakistan Institute of Development Economics, Islamabad Author-Name: M. Azeem Khan Author-X-Name-First: M. Azeem Author-X-Name-Last: Khan Author-Workplace-Name: Social Sciences Institute, National Agricultural Research Centre, Islamabad. Author-Name: Munir Ahmad Author-X-Name-First: Munir Author-X-Name-Last: Ahmad Author-Workplace-Name: Pakistan Institute of Development Economics, Islamabad. Title: Determinants of Higher Wheat Productivity in Irrigated Pakistan Abstract: While agriculture plays a vital role in overall performance of the economy of Pakistan, its crop sub-sector contributes the major portion to total value added in the sector. Wheat constitutes the most important crop that contributed 12.1 percent towards value added in agriculture and accounted for 37.18 percent of the total cropped area in the country during 1999-2000 [Pakistan (2001)]. The performance of wheat crop affects the overall growth rate, import bill, and nutritional standard of our people especially, the urban poor. It occupies a pivotal position for attaining national food-security goals. Wheat management in complex farming systems is influenced by time conflicts in the harvesting of preceding crops and the sowing of wheat, and interactions due to residual effects on succeeding crops [Byerlee, et al. (1986]. Conventionally, less dynamism is found in wheat management practices, especially when it is grown after cash crops like cotton, rice and sugarcane. The rabi 1999-2000 was an exceptional season for wheat as rice, cotton, and sugarcane crops succumbed to market forces which ultimately resulted into heavy economic losses to the farming community. Timely announcement of a quantum increase in the support price of wheat is assumed to induce the farmers to deviate from usual wheat management practices for better production. The payback to the presumed transition in conventional wheat production practices was unprecedented. Journal: The Pakistan Development Review Pages: 753-766 Volume: 40 Issue: 4 Year: 2001 File-URL: http: //www.pide.org.pk/pdf/PDR/2001/Volume4/753-766.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:753-766 Template-Type: ReDIF-Article 1.0 Author-Name: Usman Mustafa Author-X-Name-First: Usman Author-X-Name-Last: Mustafa Author-Workplace-Name: Pakistan Agricultural Research Council (PARC), Islamabad. Author-Name: Waqar Malik Author-X-Name-First: Waqar Author-X-Name-Last: Malik Author-Workplace-Name: Pakistan Agricultural Research Council (PARC), Islamabad. Author-Name: Mohammad Sharif Author-X-Name-First: Mohammad Author-X-Name-Last: Sharif Author-Workplace-Name: Pakistan Agricultural Research Council (PARC), Islamabad. Title: Globalisation and Its Implications for Agriculture, Food Security, and Poverty in Pakistan Abstract: The world trade liberalisation has been the major concern to almost all the international communities since very long due to the extensive trade restrictions imposed by the developed and industrial countries. These restrictions caused to create a very tough protectionist economic environment for all the countries [SESRTCIC (1995) and Chaudhary (2001)]. Pakistan is one of the founder members of the General Agreement on Tariffs and Trade (GATT) since 1948 and a signatory of Uruguay Round of Multilateral Trade Agreement (MTA) with Word Trade Organisation (WTO). The Agreement made significant progress in three major areas i.e. market liberalisation which could add approximately one percent of world real GDP (US$212–274 billion) and 10 percent to world trade upon full implementation of the Agreement, strengthening of rule and institutional structure, particularly the creation of WTO, which could decide on dispute and impairment of trade rules and principles, and integration of new areas into the multilateral trading system such as general agreements on trade in services (GATS) and trade-related intellectual property rights (TRIPs), trade-related investment measures (TRIMs) and the traditionally sensitive and contentious sectors (agriculture, and textile and clothing) [Abidin (1994); GATT (1994) and IMF (1994)]. The classical economists explained the welfare benefits of globalisation (by the specialisation and widening of markets through trade). Trade can bring settlement by allowing countries to take benefit of their comparative advantage, harvest the profit of scale economies and ensure competition, greater variety and potentially, more stable markets and prices. Journal: The Pakistan Development Review Pages: 767-786 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/767-786.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:767-786 Template-Type: ReDIF-Article 1.0 Author-Name: Ikram Saeed Author-X-Name-First: Ikram Author-X-Name-Last: Saeed Author-Workplace-Name: Pakistan Agricultural Research Council, Islamabad. Author-Name: Muhammad Zubair Anwar Author-X-Name-First: Muhammad Zubair Author-X-Name-Last: Anwar Author-Workplace-Name: Pakistan Agricultural Research Council, Islamabad. Author-Name: Khalid Mehmood Khokar Author-X-Name-First: Khalid Mehmood Author-X-Name-Last: Khokar Author-Workplace-Name: Pakistan Agricultural Research Council, Islamabad. Title: Contribution of Onion Seed Production to Poverty Reduction: A Case Study of Malakand Division, Pakistan Abstract: According to the latest estimates, roughly one-third of the total population of the developing countries live in poverty, majority of which are rural inhabitants (as reported 35 percent of the Pakistani rural mass). In Pakistan, the income distribution has worsened in the rural areas while it has marginally improved in urban areas during the period 1979 through 1996-97 [Pakistan (2001)]. The rural poverty is continuously feeding unemployment through migration of unskilled people to the urban areas. Poverty reduction is a priority area for Pakistan. The government is taking measures for addressing problems of the poor who are the most vulnerable amongst the different socioeconomic groups. Poverty alleviation is the main focus of the government in addition to develop physical infrastructure in rural areas and remove income disparities between income groups and regions. The government of Pakistan has initiated measures to poverty reduction through establishing number of institutions namely Pakistan Poverty Alleviation Fund, Micro-credit Bank (Khushali Bank), Pakistan Baitual Mal, Income Safety Nets, and launching Khushal Pakistan Programme and Food Support Programme. All these programmes are aiming at helping poor and hungry people by providing them food for temporary relief and micro credit for initiating sustainable economic activities. Since the majority of our population is living in rural areas, so the government is diverting more resources to improve the access for rural services and encourage greater participation in economic activities through creating employment opportunities. The programmes in education, health and population sectors have been specifically designed to extend socioeconomic opportunities to rural poor. Journal: The Pakistan Development Review Pages: 787-810 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/787-810.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:787-810 Template-Type: ReDIF-Article 1.0 Author-Name: Naved Ahmad Author-X-Name-First: Naved Author-X-Name-Last: Ahmad Author-Workplace-Name: Institute of Business Administration, University of Karachi, Karachi. Title: Corruption Perception Indices: A Comparative Analysis Abstract: The empirical literature on corruption has used data on corruption from three different sources: (i) investigative reports, (ii) newspapers, and (iii) surveys or questionnaire-based data. Some studies on corruption are based on case studies and newspaper reports. Studies by Wedeman (1997); Wade (1982) and Alam (1996) fall in this category. While these studies have presented an in-depth analysis of corruption, they do not examine a large sample of countries. Moreover, the investigative reports require detective work and sometimes connections with people in high echelons in order to expose corruption. Unlike investigative reports, access to survey data on corruption enables researchers to study corruption for a large sample of countries, but at the same time, raises questions about their subjectivity.1 However, the subjectivity of these indices is often justified on the ground that corruption is illegal in nature, and hard to measure directly. Empirical studies on the causes of corruption after the mid-1990s have used several corruption indices from Business International, International Country Risk Guide, Peter Neumann and his collaborators at Impulse, Transparency International, and World Competitiveness Report. More than one corruption index has been used in most of these empirical studies. For example, Ades and Di Tella (1997) used corruption indices from WCR and Peter Neumann and his collaborators at Impulse (1994). Treisman (2000) recently utilised four corruption indices: three from Transparency International (1996 to 1998) and one from Business International. While empirical literature on the causes of corruption using these indices continues to surge, it is imperative carefully to examine what exactly these indices portray. Journal: The Pakistan Development Review Pages: 813-830 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/813-830.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:813-830 Template-Type: ReDIF-Article 1.0 Author-Name: Arshed H. Bhatti Author-X-Name-First: Arshed H. Author-X-Name-Last: Bhatti Author-Workplace-Name: Quaid-i-Azam University, Islamabad. Title: Growth and Poverty in Pakistan: Implications for Governance Abstract: According to the Economic Surveys, Pakistan’s real GDP has grown at an average annual rate of 6.8 percent in the 1960s, 4.8 percent in the 1970s, 6.5 percent in the 1980s and 4.7 percent in the 1990s. However, that did not seem to have mitigated poverty as parallel to this growth the number of poor also kept swelling. Although different estimates put number of poor in Pakistan around 50 million, the actual could be more [Ahmad (2001)]. The average growth rates in the first halfcentury of Pakistan have been around 2 percent [Hasan (1997)]. It is pertinent to state that this discussion paper is not an attempt to challenge the figures either of the growth rates or the numbers of the poor in Pakistan. This is rather an attempt to understand the correlation of governance with growth on one hand and poverty on the other. It offers conceptual analysis of the concepts and their respective interpretation, explanation, application and ensuing misunderstandings. This paper has also attempted to challenge certain (usual) assumptions and perceptions regarding the role and relationship of growth and governance in reducing poverty in Pakistan. One has pointed out that most of the studies on the subject focus on symptoms and not the causes of poverty. This leads to on one hand growth of poverty, as poverty does not seem to halt despite certain evidence of relatively high growth particularly in 1960s. On the other hand we witness poverty of growth as whatever growth we have had it has hitherto failed either translating into corresponding mitigation of poverty or equitable collective prosperity. This is because there have not been efforts at governance level to ensure equity of impact of growth through adequate distribution mechanisms, sufficient social and human investments leading to education and skill development of women and men, who in turn could benefit from opportunities arising by way of process of economic growth. Journal: The Pakistan Development Review Pages: 831-844 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/831-844.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:831-844 Template-Type: ReDIF-Article 1.0 Author-Name: Zulqarnain Hussain Anjum Author-X-Name-First: Zulqarnain Hussain Author-X-Name-Last: Anjum Author-Workplace-Name: National Reconstruction Bureau, Islamabad. Title: New Local Government System: A Step Towards Community Empowerment? Abstract: Failure of the central/provincial governments to adequately capture local preferences and provide basic services strengthened the case for a new local government system for delivery of public services along with the authority to impose fees, taxes, user charges, etc. to finance these services. The new System aims at transferring political, administrative and fiscal powers1 from higher tiers of the government to lower tiers (Figure 1) in order to bring governments closer to common citizens for greater accountability and better understanding of the needs and preferences of people. National Reconstruction Bureau (NRB) was entrusted the task of designing a local government system which presented its first blue print in the form of “Devolution Plan 2000”. As a result of this exercise a new Local Government System has been installed in Pakistan on 14th August 2001 after the promulgation of Local Government Ordinance 2001 by all the four Provinces. The new System comprises a District Government or a City District Government and Zila Council in a district, Tehsil Municipal Administration and Tehsil Council in a tehsil (a Town Municipal Administration and Town Council in a town in a city district) and Union Administration and Union Council in a union. Village/Neighbourhood councils provide an interface with the lowest tier of the Local Government (Union Administration) with the community. Journal: The Pakistan Development Review Pages: 845-867 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/845-867.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:845-867 Template-Type: ReDIF-Article 1.0 Author-Name: Mohammad Akbar Author-X-Name-First: Mohammad Author-X-Name-Last: Akbar Author-Workplace-Name: Applied Economics Research Centre, University of Karachi and World Bank, Islamabad. Author-Name: Zareen F. Naqvi Author-X-Name-First: Zareen F. Author-X-Name-Last: Naqvi Author-Workplace-Name: Applied Economics Research Centre, University of Karachi and World Bank, Islamabad. Title: External Market Conditions, Competitiveness, Diversification, and Pakistan’s Export Performance Abstract: Pakistan’s exports evolve broadly in line with total world imports. Accordingly, Pakistan’s share in world imports was remarkably stable during the last 20 years, ranging between a minimum of 0.12 percent in 1980 and a maximum of 0.18 percent in 1992. In 1999-2000, the share was 0.15 percent. This would suggest that Pakistan’s export performance was not worse than that of the world on average. Compared to regional competitors, however, the performance was unimpressive, especially when compared to China and Thailand throughout the 1980s and 1990s or compared to Bangladesh, India, and Sri Lanka during the 1990s. All these countries succeeded in achieving sustainable market share increases in total world imports. In light of the growing awareness about the importance of exports in the overall economy of Pakistan and in view of the unimpressive export performance of Pakistan vis-à-vis other countries in the region it would be interesting to study the export performance of Pakistan and analyse the possible reasons for this poor performance and see whether it is due to demand deficiency or is it something to do with the supply side of the issue. Journal: The Pakistan Development Review Pages: 871-884 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/871-884.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:871-884 Template-Type: ReDIF-Article 1.0 Author-Name: Razzaque H. Bhatti Author-X-Name-First: Razzaque H. Author-X-Name-Last: Bhatti Author-Workplace-Name: International Institute of Islamic Economics, International Islamic University, Islamabad. Title: Determining Pak Rupee Exchange Rates vis-à-vis Six Currencies of the Industrial World: Some Evidence Based on the Traditional Flow Model Abstract: Pak-rupee exchange rates vis-à-vis many currencies of the industrial world have weakened continuously and persistently since Pakistan abandoned fixed exchange rates in April 1982. This proposition is strongly supported by descriptive test statistics, as shown in Table 1, such as mean, standard deviation and coefficient of variation of six Pak rupee exchange rates—against the U.S. dollar, British pound, German mark, Japanese yen, Swiss franc and French franc—over the period 1982q1-2000q4. Based on these descriptive statistics, it is evident that Pak rupee has depreciated persistently against all currencies of the industrial countries in question over the period under investigation; for example, it has depreciated by 324.05 percent against the British pound, 406.360 percent against the U.S. dollar, 344.53 percent against the French franc, 498.48 percent against the Swiss franc, 477.78 percent against the German mark and 986.25 percent against the Japanese yen since April 1982. As evidenced by coefficient of variation, Pak rupee has weakened enormously against all currencies of the industrial world, while it has weakened relatively more alarmingly against the Japanese yen, Swiss franc and German mark. Journal: The Pakistan Development Review Pages: 885-897 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/885-897.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:885-897 Template-Type: ReDIF-Article 1.0 Author-Name: Yusuf H. Shirazi Author-X-Name-First: Yusuf H. Author-X-Name-Last: Shirazi Author-Workplace-Name: Atlas Group of Companies, Karachi. Title: Reconstruction of Pakistan Economy— An Entrepreneur’s View Point Abstract: Investment, production and export are sine quo non of a viable economy. Pakistan has, however, constantly suffered from its inability to achieve this viability— more recently arising out of the nuclear testing in May 1998, followed by the change of government in October 1999 and the 11th September 2001 disaster at the World Trade Centre in New York, which ultimately lead to the war in Afghanistan. Journal: The Pakistan Development Review Pages: 901-909 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/901-909.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:901-909 Template-Type: ReDIF-Article 1.0 Author-Name: Yousaf Haroon Mujahid Author-X-Name-First: Yousaf Haroon Author-X-Name-Last: Mujahid Author-Workplace-Name: National Postgraduate Institute of Telecommunications and Informatics (NPGIT&I), Islamabad. Title: Digital Opportunity Initiative for Pakistan Abstract: “People lack many things: jobs, shelter, food, health care and drinkable water. Today, being cut off from basic telecommunications services is a hardship almost as acute as these other deprivations, and may indeed reduce the chances of finding remedies to them”. By these remarks at Telecom 99 in Geneva, Switzerland, UN Secretary General Kofi Anan warned of the danger of excluding the world’s poor from the information revolution. Although the world has seen exponential progress in terms of artificial intelligence, biotechnology, genetic engineering, neural networks, neurolinguistic programming, information technology management, telematics and infonomics, trade liberalisation, space exploration—but on ground the very pace and velocity of knowledge-driven growth has left a giant crevice between the information haves and the information have-nots, giving birth to a nomenclature called—the Digital Divide. Today information has become the most vibrant force and factor of production in the new economy contrary to the four traditional factors of production. Information has become the most important source of economic activity and the link which drives the info-hungry entrepreneurs to utilise the four factors of production in the optimal manner. Not land, not labour, not capital has done for an entrepreneur which the information alone has done. The world has seen a paradigm shift from scarce economic resources to the Age of Abundance—where plenty of information is available! Journal: The Pakistan Development Review Pages: 911-928 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/911-928.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:911-928 Template-Type: ReDIF-Article 1.0 Author-Name: Mohammed Nishat Author-X-Name-First: Mohammed Author-X-Name-Last: Nishat Author-Workplace-Name: Institute of Business Administration, University of Karachi, Karachi. Title: Industry Risk Premia in Pakistan Abstract: Industry characteristics is one of the main factors that determines a firm’s business risk [Kale, Hakansson, and Platt (1991)], and a single information can affect more than one security price change, perhaps even the whole market. Lessard (1974, 1976) explains that industry plays an important role in explaining national market volatility. One of the reasons for stock index behaviour are attributed to industrial composition as some industries are internally more volatile than the other [Grinold, Rudd, and Stefek (1989)]. Moreover, some sectors show a high degree of global integration, for example, the finance sector [Roll (1992)]. Similarly, consumer goods, fuel and energy, and transportation sectors are extremely important for any country index. King (1966) suggests that if a significant difference in industry risk premia is observed, then we need to isolate the market risk premia and industry risk premia. He observed that the industry components of variance showed much less change from sub-period to sub-period. Significant differential impact of regulatory policy on cost of capital across various sectors was also observed [Isimbabi (1994); Prager (1989)]. The industry specific policies in Pakistan are observed either as a part of the reform package during 1988 and early 1990s, or as an additional policy measure to further boost the private investments in priority sectors. These policies included incentives for foreign investment through permission for repatriation of profits, the easing of investment and banking sector regulations and easy access to loans and tax exemptions on priority sectors like power, exports and agriculture based industries. In addition, the government encouraged equity participation to avoid instability through growing leverage. Journal: The Pakistan Development Review Pages: 929-949 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/929-949.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:929-949 Template-Type: ReDIF-Article 1.0 Author-Name: Abdul Qayyum Author-X-Name-First: Abdul Author-X-Name-Last: Qayyum Author-Workplace-Name: Pakistan Institute of Development Economics, Islamabad. Title: Sectoral Analysis of the Demand for Real Money Balances in Pakistan Abstract: The main objective of monetary policy in Pakistan, as in other countries, is to achieve price stability. In order to achieve the objective of stable prices, the State Bank of Pakistan is using M2 definition of money supply as an intermediate target variable to conduct the monetary policy. This choice of target variable is based on the long understanding that only the demand for M2 monetary aggregate is stable in Pakistan. The definition of money aggregates two main sectors of the economy that is business sector and household sector. Theories such as quantity theory, Keynesian and transactions, state that both sectors have diversified behaviour. Money demand behaviour of these sectors largely depends on the different sets of variables. Therefore the aggregation of these sectors is rather poor. Further the research conducted in Pakistan mainly concentrated on the estimation of aggregate money demand function by using annual data. Some of the studies, however, used quarterly data. They have estimated money demand functions by disaggregating data on monetary assets basis, particularly M1 and M2. However, relatively thin literature is available on the estimated money demand function by disaggregating business and household sectors. It is argued that money demand behaviour of different sectors of the economy may be different. In this paper the long-run cointegration relationship and the error correction model of the real demand for money in desegregated, business and personal sector, form are estimated by using quarterly data. Then the estimated error correction models are tested for structural break. The empirical importance of the real demand for money in disaggregate form is that it would provide new insight in the conduct of monetary policy in Pakistan Journal: The Pakistan Development Review Pages: 953-966 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/953-966.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:953-966 Template-Type: ReDIF-Article 1.0 Author-Name: Muhammad Sabir Author-X-Name-First: Muhammad Author-X-Name-Last: Sabir Author-Workplace-Name: Social Policy and Development Centre (SPDC), Karachi. Title: Dynamic Consequences of the 1997 NFC Award: Provincial Social Sector Expenditures Abstract: An adequate provision of social services is a concurrent function of federal and provincial governments. However, in Pakistan, the financing and delivery of social services largely prevails in the hands of provinces and major sources of revenues in the hand of federal government, which creates vertical imbalances. Federal transfers are the mechanism for their correction and these are constituted through the National Finance Commission (NFC) Awards. The last NFC Award was constituted in 1997 and it changed both the size of divisible pool and the share of federal and provincial governments in the divisible pool. The changed provincial shares have based on higher tax revenue collection, which was not materialised during the following four-year period after the award. Therefore, provincial governments experienced the shortfall in the federal transfers during last four years after the award and have experienced a lower growth in transfers than projected in 1997 NFC Award. This is in contrast with the provincial experience during 1991 NFC Award, in which provinces had received higher revenue transfers from federal government than projected. Journal: The Pakistan Development Review Pages: 967-984 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/967-984.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:967-984 Template-Type: ReDIF-Article 1.0 Author-Name: Qaisar Abbas Author-X-Name-First: Qaisar Author-X-Name-Last: Abbas Author-Workplace-Name: Barani Areas Development (ABAD), Rawalpindi. Title: Endogenous Growth and Human Capital: A Comparative Study of Pakistan and Sri Lanka Abstract: Economic Growth has posed an intellectual challenge ever since the beginning of systematic economic analysis. Adam Smith claimed that growth was related to division of labour, but he did not link them in a clear way. After that Thomas Malthus developed a formal model of a dynamic economic growth process in which each country converge toward stationary per-capita income. According to this model, death rates fall and fertility rises when income exceed the equilibrium, and opposite occur when incomes are less than that level. Despite the influence of the Malthusian model in nineteenth century economists, fertility fell rather than rose as income grew during the past 150 years in the west and other parts of the world. The Neoclassical growth model of Solow (1956), which has been for the past thirty years the central framework to account for economic growth, focuses on exogenous technical population factors that determine output-input ratios, responded to the failure of Malthusian model. Neither Malthus’s nor the Neoclassicists approach to growth pays much attention to Human Capital. Yet the evidence is quite strong of close link between investments in human capital and economic growth. Since human capital embodied knowledge and skills, and economic development depends on advances in technological and scientific knowledge, development presumably depends on the accumulation of human capital. Investment in human capital has been a major source of economic growth in advanced countries. The negligible amount of human investments in underdeveloped countries has done a little to extend the capacity of people to meet the challenge of accelerated development. Journal: The Pakistan Development Review Pages: 987-1007 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/987-1007.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:987-1007 Template-Type: ReDIF-Article 1.0 Author-Name: M. Arshad Mahmood Author-X-Name-First: M. Arshad Author-X-Name-Last: Mahmood Author-Workplace-Name: Ministry of Population Welfare, Islamabad. Title: Determinants of Growth Retardation in Pakistani Children under Five Years of Age Abstract: Ensuring the survival and well being of children is a concern of families, communities, and nations throughout the world. Since the turn of the 20th century infant and child mortality in more developed countries has steadily declined and, currently, has been reduced to almost minimal levels. In contrast, although infant and child mortality has declined in the past three decades in most less developed countries, the pace of change and the magnitude of improvement vary considerably from one country to another. Children are at risk of both mortality and morbidity. The problem of malnutrition is widespread in developing countries and particularly severe in South Asian countries, where almost fifty percent of the undernourished children of the world live [Carlson and Wardlaw (1990)]. Rural populations are especially prone to malnutrition because they are more likely to be poor [Tinger (1998)]. The analysis of Demographic and Health Surveys (DHS) in 19 developing countries shows that children living in rural areas are more likely to be malnourished [Sommerfelt and Stewart (1994)]. A poor diet and exposure to repeated illnesses are two of the major causes of malnutrition in developing countries [Mosley and Chen (1984)]. When the child survives the neonatal period, better child nutrition becomes an important part of child health since nutrition during childhood makes a major contribution to child development, growth, and survival, ultimately influencing the human and social capital of a society. The role of breastfeeding is very important in the post-neonatal period. The mother’s milk not only provides the complete nutritional requirements of the child but also provides protection against infection [Jelliffe and Jelliffe (1978)]. Pregnant women who receive inadequate nutritional levels are likely to give birth to underweight babies who are more likely to get infectious diseases, leading to early death. Journal: The Pakistan Development Review Pages: 1009-1031 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/1009-1031.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:1009-1031 Template-Type: ReDIF-Article 1.0 Author-Name: Anwar F. Chishti Author-X-Name-First: Anwar F. Author-X-Name-Last: Chishti Author-Workplace-Name: NWFP Agricultural University, Peshawar. Author-Name: Waqar Malik Author-X-Name-First: Waqar Author-X-Name-Last: Malik Author-Workplace-Name: Pakistan Agriculture Research Council, Islamabad. Title: WTO’s Trade Liberalisation, Agricultural Growth, and Poverty Alleviation in Pakistan Abstract: Pakistan is an agrarian based developing country, and like many other developing countries, its agriculture sector is subjected to domestic forces of demand and supply and changes in prices at international level, as well. More specifically, in the late 1990s, the World Trade Organisation (WTO) emerged as one the major players affecting such market changes more vigorously at international arena. The WTO’s Agreement on Agriculture, which was established as a result of the 1986–94 Uraguay Round talks, requires, for both developed and developing countries, to initiate a process of reforms in their agrarian economies with the objective of establishing a fair and market oriented agricultural trading system through multilateral trade negotiations. This Agreement on Agriculture (AoA) specifically asks for major reductions in export subsidies, domestic support and import barriers on agricultural products to achieve this objective, the WTO’s Agreement of Agriculture [WTO (2001)] had set the following quantitative targets for cuts in each of the three specified area, namely import tariffs, domestic supports and export subsidies. Journal: The Pakistan Development Review Pages: 1035-1052 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/1035-1052.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:1035-1052 Template-Type: ReDIF-Article 1.0 Author-Name: Zakir Hussain Author-X-Name-First: Zakir Author-X-Name-Last: Hussain Author-Workplace-Name: University of Agriculture, Faisalabad and Agricultural Economist, International Water Management Institute, Lahore. Author-Name: Riaz Hussain Qureshi Author-X-Name-First: Riaz Hussain Author-X-Name-Last: Qureshi Author-Workplace-Name: University of Agriculture, Faisalabad and Agricultural Economist, International Water Management Institute, Lahore. Author-Name: Waqar A. Jehangir Author-X-Name-First: Waqar A. Author-X-Name-Last: Jehangir Author-Workplace-Name: University of Agriculture, Faisalabad and Agricultural Economist, International Water Management Institute, Lahore. Title: Trade Liberalisation Policies, Intra-regional Trade and Opportunities for Sustainable Agricultural Development Abstract: Many of the Near East (NE) countries are currently opening their agricultural markets at three distinct but interacting levels: unilateral liberalisation, regional integration schemes and multilateral trade liberalisation. These changes hold important implications for intra- and extra-regional trade, use of agricultural resources and sustainability of agricultural development in the NE countries. Unilaterally, and since the late 1980s, most countries of the region have liberalised their agriculture sectors by eliminating or reducing input subsidies, removing or reducing guaranteed producer prices, reducing the number of subsidised commodities and liberalising the exchange rate and the trade regime. Most of the implicit and explicit subsidies for agricultural inputs and outputs were withdrawn. However, some of the NE countries were able to continue supporting agriculture mainly for food security reasons. Experiences showed that domestic reform is necessary but not sufficient condition for economic growth. Journal: The Pakistan Development Review Pages: 1053-1074 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/1053-1074.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:1053-1074 Template-Type: ReDIF-Article 1.0 Author-Name: Shahnaz Hamid Author-X-Name-First: Shahnaz Author-X-Name-Last: Hamid Author-Workplace-Name: Pakistan Institute of Development Economics, Islamabad. Author-Name: Rehana Siddiqui Author-X-Name-First: Rehana Author-X-Name-Last: Siddiqui Author-Workplace-Name: Pakistan Institute of Development Economics, Islamabad. Title: Gender Differences in Demand for Schooling Abstract: The comparison of human development indicators in Table 1 shows that Pakistan’s performance is below the average for South Asian countries and below the average for the developing countries. Furthermore, gender differences in human development are also significant within country and across countries. For example, in 1999, differences in male and female literacy rate was 24 points in Pakistan, higher then the difference in less developed countries (equalling 15 points). [See HDC (2001)]. Similarly, within Pakistan, male literacy rate increased from 35 percent in 1980-81 to 56.6 percent in 1998-99 whereas female literacy rate increased from 16 percent in 1980-81 to 32.6 percent in 1998-99. This shows that despite doubling of female literacy rate, the gap between male and female literacy rate widened from 19 percent in 1980-81 to 24 percent in 1998-99. Similarly, another indicator of human capital, i.e., the net enrolment rates at primary level exhibited a declining trend in 1990s, particularly among males. An important reason for the decline could be rise in poverty. Table 2 shows a sustained increase in net enrolment ratio with income, and the positive income effect is higher in urban areas. In rural areas, the enrolment rate increases with income but there is slight decline in female enrolment rate at the highest income level. Thus, despite rapid rise in female enrolment the gender, differences persist and income is the main factor affecting demand for education. Journal: The Pakistan Development Review Pages: 1077-1092 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/1077-1092.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:1077-1092 Template-Type: ReDIF-Article 1.0 Author-Name: Rashida Haq Author-X-Name-First: Rashida Author-X-Name-Last: Haq Author-Workplace-Name: Pakistan Institute of Development Economics, Islamabad. Title: Occupational Profile of Poverty in Pakistan Abstract: The issue of poverty in Pakistan has its significance for sustainable development. Long run development is not possible without protecting the rights of the vulnerable groups and the participation of the entire population in the development process. A notable development in the last decade in Pakistan’s economic scene has been the sharp pick up in the incidence of poverty. It can be attributed to several factor. The real GDP growth fell from 6 percent in the 1980s to 5 percent in the first half of the 1990s and declined further to just over 4 percent in the second half of the decade. The rate of inflation remained in single digits throughout the 1980s but had a rapid increase of 12 percent during the first half of the 1990s. It is significant to note that food prices generally rose more sharply than overall consumer price index. The unemployment rate increased by 2 percent in the 1990s as compared to in the 1980s reflecting the deceleration of labour absorption in the economy in response to the significant decrease in the economic growth during the nineties. Journal: The Pakistan Development Review Pages: 1093-1104 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/1093-1104.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:1093-1104 Template-Type: ReDIF-Article 1.0 Author-Name: Toseef Azid Author-X-Name-First: Toseef Author-X-Name-Last: Azid Author-Workplace-Name: Bahauddin Zakariya University, Multan. Author-Name: Muhammad Aslam Author-X-Name-First: Muhammad Author-X-Name-Last: Aslam Author-Workplace-Name: Commissioner Office, Bahawalpur. Author-Name: Muhammad Omer Chaudhary Author-X-Name-First: Muhammad Omer Author-X-Name-Last: Chaudhary Author-Workplace-Name: Bahauddin Zakariya University, Multan. Title: Poverty, Female Labour Force Participation, and Cottage Industry: A Case Study of Cloth Embroidery in Rural Multan Abstract: It is a well-known fact that cottage industries can play a significant role in the development of an economy like Pakistan. As it is observed that this industry is not required too much financing, imported and highly sophisticated technology. So the problems like deficit in public finance and balance of payments is not related with the growth and development of these industries. Simultaneously, high degree of female labour force participation in this sector has also been proved in the number of studies. Which seems to be helpful in the process of reduction of poverty especially in the rural areas. The Southern Punjab especially its rural areas are comparatively less prosperous than the other parts of Punjab. A number of female workers can be seen in the rural areas of Southern Punjab. The concentration of these workers is in few traditional areas and is characterised by the low technology and low production levels. These areas are typically those, which require skills that are basically the extension of household skills or which reflect a specific educational and employment experience of women. It has also been observed that women’s income of the rural areas of Southern Punjab are more likely than their male partners to go towards meeting their family’s basic needs. These women spent most of their business income on the households, food, clothing and education of their children rather than reinvesting it in their business. Journal: The Pakistan Development Review Pages: 1105-1118 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/1105-1118.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:1105-1118 Template-Type: ReDIF-Article 1.0 Author-Name: Arshad Zaman Author-X-Name-First: Arshad Author-X-Name-Last: Zaman Author-Workplace-Name: Arshad Zaman Associates (Pvt.), Ltd., Karachi. Title: The Economics of Stateless Nations: Sovereign Debt and Popular Well-being in Pakistan Abstract: The Government of Pakistan believes that “high and growing” indebtedness of the government is reflected in falling investment and growth rates of the economy, leading to growing poverty of the people. This paper examines how this came to be, and whether the connections implicit in this assessment do in fact exist? On this basis, the paper also comments on the efficacy of some current policy proposals. The conventional wisdom is that “persistent fiscal and balance of payments deficits are a fundamental source of Pakistan’s high debt burden” [Pakistan (2001), p. xv)].1 The State Bank of Pakistan (2001, p. 117) goes further: “This…public debt is the result of structural weaknesses in the domestic economy and the external account. Excessive government expenditures, stagnant tax revenues, high returns on government securities and inappropriate sequencing of financial reforms, led to a bludgeoning (sic.) domestic debt profile. On the external front, large current account deficits, stagnant export revenues and declining worker (sic.) remittances, effectively forced Pakistan into an unsustainable situation”. All this is true, but hardly exhaustive. Journal: The Pakistan Development Review Pages: 1121-1134 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/1121-1134.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:1121-1134 Template-Type: ReDIF-Article 1.0 Author-Name: Rafique Ahmad Author-X-Name-First: Rafique Author-X-Name-Last: Ahmad Author-Workplace-Name: University of the Punjab, and Nazaria-e-Pakistan Foundation, Lahore. Title: Democratic Welfare State as Visualised by the Quaid-i-Azam Abstract: The Quaid-i-Azam, Muhammad Ali Jinnah, is known more for his political achievements than for his socio-economic thought. Last two decades, however, have seen a continuous flow of books containing his speeches, statements, messages, interviews, discussions in pre-independence legislative bodies and addresses in the Constituent Assembly of Pakistan. Even a cursory look at this vast literature shows that he was not only concerned with the political aspect of sub-continent’s independence movement but also consistently expressed his views regarding the socio-economic uplift of masses in general and Muslim society in particular. These views in their bare essentials reflect a remarkable continuity of approach from the earlier days of his political career to the period he occupied the position of Governor General of Pakistan. Actually, he became more and more expressive and forthright as the prospects of Pakistan coming into existence became bright. When Pakistan finally appeared as a sovereign nation on the map of the world, he openly rejected the prevailing economic system as having failed to do justice between man and man and to eradicate friction from the international field. Journal: The Pakistan Development Review Pages: 1137-1146 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/1137-1146.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:1137-1146 Template-Type: ReDIF-Article 1.0 Author-Name: Zawwar Hussain Zaidi Author-X-Name-First: Zawwar Hussain Author-X-Name-Last: Zaidi Author-Workplace-Name: The Quaid-i-Azam Papers Project, Islamabad. Title: Economic Vision of the Quaid-i-Azam Abstract: The Quaid-i-Azam Mohammad Ali Jinnah, who transformed the All India Muslim League from a run-of-the-mill political party into a mass movement. His role as the founder of an independent sovereign Muslim state in South Asia has been widely acclaimed by historians and scholars. However, his political tour de force has rather overshadowed what he did for the economic emancipation of Muslims before and after Independence. The demand for Pakistan visualised not just freedom from colonial rule but, no less importantly, liberation from the socio-economic domination of the majority community in business, commerce, education and public services. Jinnah knew full well that the areas to be included in Pakistan were economically and industrially backward. They constituted the agricultural hinterland of the industrialised areas of British India. Journal: The Pakistan Development Review Pages: 1147-1154 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/1147-1154.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:1147-1154 Template-Type: ReDIF-Article 1.0 Author-Name: Sharif Al Mujahid Author-X-Name-First: Sharif Al Author-X-Name-Last: Mujahid Author-Workplace-Name: Archives of the Freedom Movement, Karachi. Title: Economic Ideas of the Quaid-i-Azam Abstract: The present paper consists of four parts. First, it is argued why the Quaid-i- Azam, Mohammad Ali Jinnah (1876–1948), concentrated for the most part on political issues and political freedom, why he went in for Islam as the cultural metaphor in arguing the case for Pakistan, and why he opted for couching his marathon (1937–47) discourse in Islamic terms. Second, the legacy in terms of the primacy of economic factors in propelling a colonised people towards political emancipation Jinnah had received from the historic realm and his own background— in particular, the economic bias in his family background, in Bombay’s mercantile culture which was almost at the centre of the most formative influences in his early life, and in the pronouncements of, and proposals mooted by, Muslim leaders from Sir Syed Ahmad Khan (1817–1898) down to Iqbal (1877–1938) on the one hand, and by the Mohammedan Educational Conference (f.1836) to the All India Muslim League (1906–47), on the other. These proposals were essentially aimed at exhorting the intelligentsia to work for the social, economic and political uplift of the masses. Third, the stress on economic emancipation and the rise of Muslim economic nationalism in the 1940s, in the wake of the Lahore Resolution (1940), has been discussed and delineated briefly. Fourth, an attempt has been made to set forth, as systematically as is possible for a student of another discipline, Jinnah’s economic ideas, extracted from his multitudinous pronouncements, which could serve as guidelines for the economic reconstruction of Pakistan, wherever feasible. Journal: The Pakistan Development Review Pages: 1155-1165 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/1155-1165.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:1155-1165 Template-Type: ReDIF-Article 1.0 Author-Name: Pervez Tahir Author-X-Name-First: Pervez Author-X-Name-Last: Tahir Author-Workplace-Name: Planning Commission, Government of Pakistan, Islamabad. Title: Introducing Iqbal the Economist Abstract: The Iqbal Memorial Lecture was instituted in 1994 when the Pakistan Society of Development Economists (PSDE) celebrated the completion of a decade of steady progress. A brief announcement stated: “The Iqbal Memorial Lecture attributed to the national poet [Emphasis added], Allama Muhammad Iqbal has been included in the programme for the first time. Professor Ian M. D. Little is delivering that lecture” [Secretary’s Report (1994), p. 1472]. Iqbal, the poet and philosopher par excellence, has made incisive remarks or comments on economic and social issues in his poetry, philosophical writings, and in the course of his discourses as well as some famous letters, particularly those written to the Quaid-i-Azam, Muhammad Ali Jinnah, the founder of Pakistan. But these do not make Iqbal an economist. The Secretary of the PSDE was, therefore, careful in observing that the lecture commemorates our “national poet”. However, it will be of great interest to this largest national congregation of economists and other scholars concerned with development to know that the very first published book of Iqbal related neither to poetry nor philosophy, but economics. It was written in Urdu. He also taught the subject at undergraduate and Master’s level, even though he had not studied it as a student. At the Government College, Lahore, Iqbal studied English, Philosophy and Arabic for his B.A. and then completed the M.A. in Philosophy. Journal: The Pakistan Development Review Pages: 1167-1176 Volume: 40 Issue: 4 Year: 2001 File-URL: http://www.pide.org.pk/pdf/PDR/2001/Volume4/1167-1176.pdf File-Format: Application/pdf Handle: RePEc:pid:journl:v:40:y:2001:i:4:p:1167-1176