The paper provides a consistent time-series of poverty
estimates for the period 1963- 64 to 1992-93 for both the rural as well
as the urban areas, examines the influence of macroeconomic policies on
the poverty levels, analyses the impact of Structural Adjustment
Programmes on the levels of poverty, and suggests a strategy for poverty
alleviation in Pakistan. The paper explores in particular the influence
on poverty of such factors as economic growth, agricultural growth,
terms of trade for the agriculture sector, industrial production, rate
of inflation, employment, wages, remittances, and the tax structure.
While the paper cautions that on account of the limited number of
observations the results of the study should be interpreted cautiously,
the study does suggest that the growth above a threshold level of about
5 percent, increase in employment, and remittances are the most
important variables explaining the change in poverty over time. The
paper also comes to the conclusion that the policies pursued under the
Structural Adjustment Programme have tended to increase the poverty
levels mainly because of decline in growth rates, withdrawal of
subsidies on agricultural inputs and consumption, decline in employment,
increase in indirect taxes, and decline in public expenditure on social
services. The paper also outlines a strategy for poverty eradication and
argues that besides the safety nets, the employment programmes, as well
as promotion of informal sector enterprises, are essential.
Africa’s Current Path
