I= ‚€œAN ECONOMIC ANALYSIS OF COSTS AND BENEFITS OF PAKISTAN‚€™S INVESTMENT IN POPULATION CONTROL 1965-88‚€Ě
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Title of Thesis
‚€œAN ECONOMIC ANALYSIS OF COSTS AND BENEFITS OF PAKISTAN‚€™S INVESTMENT IN POPULATION CONTROL 1965-88‚€Ě

Author(s)
Amatul R. Chaudhary
Institute/University/Department Details
Department of Economics University of the Punjab, Lahore
Session
1994
Subject
Economics
Number of Pages
315
Keywords (Extracted from title, table of contents and abstract of thesis)
POPULATION CONTROL, Averted births based, Cost per averted birth, Benefit per averted birth, M. Amin-ur-Rehman, M.N.I. Farooqui, G.Y. Soomro, Rukanuddin

Abstract
This thesis aims al presenting all ecomomic analysis of Pakistan Government‚€™s investment in population control programme during the period 1965-88. Economic analysis ill the context of this research implies an estimation of economic returns from public expenditure on the government Os approved population control measures.

It may be asked as to what precisely economic returns mean and how they are assessed. To answer this question the present study has cast a look at the current demographic literature which reveals that quantitatively speaking. economic benefits of a population control program can be ascertained by measuring anyone of the following:-

(i) Contribution of population control programme in the form of lower fertility rates to the achievement of a nation‚€™s overall economic goals as given in its five year plans.

(ii) Changes in the knowledge, altitude and practice of family planning and its resultant economic impact in the form of better nutrition, more savings. Higher consumption and similar type of benefits.

(iii) Saving in public expenditure on social overheads like schools, hospitals. housing and transport because of reduced rate of population growth.

(iv) Monetary benefits due to averted births made possible by population control measures. These monetary benefits can he viewed from a number or angles like higher per capita income. more capital formation or reduced unemployment.

This research show that the last method of measuring economic returns is relatively more free of flaws from which other methods suffer. Take. for example. The first method. It requires the measurement of demographic impact of the family planning programme in the form of reduced birth rates. But decline in birth rate is dependent on many factors. family planning being only one of them. Even if birth rates do not show any significant downward trend. population control programme may still be exerting powerful influence in counteracting. the effects of declining mortality rates. As against this. decline in birth rates may he due to changes in social and economic determinants of fertility or cultural factors influencing breast-feeding practices, age at marriage. gainful employment of women in economic fields and female literacy rates. As the type of data required for isolating these influences to assess the net contribution of population control programme was not available in Pakistan at the time this study was initiated. this approach was not attempted.

The second method of assessing economic returns cannot accurately depict the contribution of population control programme because change in attitudes and use of contraceptives cannot he ascribed merely to efforts of population control network in the country. Other intermediate variables. e.g. education. audio-visual aids. exposure to western ways of life and a multiplicity of other factors can also be responsible for a change in attitudes. So this type of assessment was also not considered.

The third method of assessment in terms of savings in public expenditure due to lesser demand for social overheads also lacks precision. Social overheads include schools. hospitals. means of transport and housing. An attempt to measure economic returns by this method can only partially depict the benefits from population control programme because of the difficulties of identifying and estimating all relevant variables. Hence this approach was also not found suitable for the purpose of this research.

The fourth method focusing on calculation of births averted because of the population control programme docs not seem to suffer from any of the imperfections mentioned with reference to other methods. So this study focused on the calculation of the monetary benefits of averted births for an assessment of economic returns.

This disseration is divided into four parts. each having a different theme within the overall framework of the study in a logical sequence. Benefit/cost calculations as well as other mathematical derivations and application of multiple regression analysis are based on data tabulated in appendices A,B.C,O,E,F,G and H. Abbreviations and glossary of some relevant demographic terms are also appended.

PART-I This part consists of chapter I which focuses on the vitally crucial role of two interacting sets of variables i.e. economic development and population growth. Theory of demographic transition and vicious circle of poverty has also been discussed in this context. The objective of this disseration of developing an economic rationale for further investment in population control programme of Pakistan has been corroborated as well.

PART-II Conceptual framework of this study is discussed in this part consisting of chapters 2,3,4 and 5.

In chapter 2. an overview of a few evaluative techniques attempting economic evaluation of population control programmes is given.

In chapter 3. Some models attempting economic analysis of population control programmes in other countries have been reviewed briefly. Coale and Hoover's model. has neglected cost of population control programme. George B. Simmons. in a refined version of Coale & Hoover‚€™s model. included the cost element but did not calculate the net survivors of averted births of the previous time periods which have been included in the present model. In Enke‚€™s model. cost was defined as the loss of productive services of the unborn child. whereas benefits were defined as difference between consumption and production of the unborn. Consumption would have strarted at 7.ero age whereas production could start at age fifteen or above. Difference between the two magnitudes was the upper limit of the money bonus which could be given to contracepting parents. Zaidan‚€™s model was based on the framework constructed by Enke with some refinements. Roth Enke‚€™s and Zaidan‚€™s models do not include the expenditure on population control programme as part of the cost. which has been included in the present model. Robinson‚€™s model does not contain any of the flaws mentioned above but requires data of the type not available in Pakistan. Models put forward by Simon. Bower and Demeny have also been briefly discussed in this chapter.

In chapter 4. a review of studies aimed at evaluation of population control programme of Pakistan has been done. The degree of over-estimation of output data generated by the population control network has been estimated by Farooqui and Soomro as 41 %. Accordingly, in my estimation of averted births. such data have been reduced by 41 % before converting these magnitudes into averted births. Khan. Using Enke‚€™s coefficients calculated benefit/cost ratio for Pakistan within a range of 18:1 and 38:1 which forms a basis for comparison with the benefit/cost ratio calculated as 15.2:1 in this study.

In chapter 5. a brief introduction to the technique of benefit/cost analysis as well as economic models is given. The process of interlinking variables. constants and parameters in the form of definitional or behavioural equations in the appropriate mathematical structure has been explained. Prerequisites and salient features of economic models have also been briefly discussed. A new Averted Births Based (ABB) model has been developed for this study. This demographic/economic model is simple yet realistic. It has assumptions and limitations peculiar to this type of models. Interestingly, removal of some of the assumptions or limitations makes the benefits larger than depicted in the model. It may be mentioned here that in the case of models allempting to calculate economic benefits of population control programmes. precision of results and forecasting ability of the model depend not only on the degree of sophistication of the model but also on quality of data which is based on surveys. involving interviews and questionnaires. Heterogeneity in the quality of interviewers & interviewees affects the quality of data which is generated by probing into a very private. subtle and delicate aspect of human behaviour. In Pakistan. in addition to the above mentioned limitations. there are inconsistencies in the data whether data is generated by more than one agency. or by the same agency overtime as discussed in details in Part III. Working with all such limitations, I have built the ABB model which interconnects the basic macro economic variables in a causal way. The mathematical form of the definitional and behavioural equations comprising the model is linear. As far as I know. the conceptual framework of the model is different from any of the models reviewed in this study or being developed by researchers world-wide.

PART-III In This Part consists of chapters 6.7 and 8 which gives an analysis of Pakistan‚€™s investment in population control programme.

Chapter 6 depicts various contours of the uneven population po1icy adopted by Pakistan government. The rationale for wild fiuctuati0ns in costs has been traced and examined critically. Different drawbacks of Pakistan's population policy have been highlighted as well.

In chapter 7. an attempt has been made to compare targets. implementation and achievements of the population control programmes in various Five Year Plans of Pakistan. A number of discrepancies have been pointed out. A critical evaluation of Pakistan's population control programme in various Five-Year Plans has shown that greater success could have been achieved with a better organized. more imaginative. consistent and continuous programme.

In chapter 8. application of the ABB model to Pakistan's population control programme (1965-88) has been attempted. Great care has been taken to use only published and authenticated data. Data source of every variable used in the model has been given explaining the adjustments made and pointing out inadequacies if any. Number of averted births have been calculated each year from 1965 to 1988. The year 1965-66 has been taken as the starting year in this study because government run population control programme had gained momentum by that year. Total money benefits each year due to net averted births which could have been added to the population that year in the absence of any programme of population control. have been calculated. These yearly series of money benefits have been converted in terms of constant price level of 1980-81 which has been assumed to he the base year. Similarly, cost of population control programme has been calculated as sum of the yearly expenditure incurred on population control programme and converted into constant price level of 1930-8. Other types of costs e.g. opportunity costs or indirect costs have been ignored.

PART-IV This part consists of chapters 9,10 and 11 and deals with findings and recommendations.

Chapter 9 summarizes various economic aspects of the calculations done in chapter 8. Calculations of yearly benefit/cost ratios (ranging between 1.49 to 31.19) warrant further expansion of this programme of population control. Similarly, yearly benefit per averted birth (ranging between Rs. 1993 to Rs. 4098) has been compared with yearly cost per averted birth (ranging from Rs. 103 to Rs. 1339) to establish an economic rationale for more flow of funds in this direction till the point where benefit per averted birth is equalized to cost per averted birth. This economic rationale of allocation of funds to competing projects should be carefully considered by policy makers of Pakistan. It has also been concluded that the model built for this study can be applied to any other country with modifications in assumptions. if necessary. So in my view the model has universal applicability.

Chapter 10 explores the model further to find whether it can be used to forecast future benefits out of a given amount of cost. Multiple regression analysis was used after ensuring mathematically that the assumptions of linearity of costs and benefits functions was permissible. Different cases were considered such as the following:-

(i) Taking. cost and lime as explanatory variables and current benefits as explained variable.

(ii) Taking cost and time as explanatory variables and accumulated benefits as explained variable.

(iv) Taking time only as explanatory variable and accumulated benefits as explained variable.

The structural parameters in all the above models were estimated using OLS (ordinary least squares) method of curve fitting. The calculated values of F-Statistics. T-Statistics and R2 in all the above models revealed that both time and cost explained the variations in benefits to a fairly large extent and that the overall regression model was a good fit. However. forecasting was not possible he-cause of wild and abrupt fluctuations in yearly costs.

Chapter 11 consists of conclusions of this study and recommendations. It suggests a policy-framework giving due importance to cultural, religious and political factors and stressing the multi-disciplinary nature of this study. It has been pointed out that the population problem is only a part of the overall problem of poverty and underdevelopment in this region. It has been concluded that the well being of the common man may not he improved by investing in population control programmes only. Other sectors like health, education. housing and manpower require effective and radical policies as well. Population policy can be effective only if it is an essential component of a well coordinated national Economic plan. Also, in order to make this programme cost effective. organizational improvements within the population control network are inevitable. Similarly. political stability and administrative reforms are of vital importance to provide the basic infrastructure for the success of this programme in Pakistan.

Download Full Thesis
3481.32 KB
S. No. Chapter Title of the Chapters Page Size (KB)
1 0 Contents
294.33 KB
2 1 Introduction 1-14
181.21 KB
  1.1 Introduction
  1.2 Importance Of Population Studies In The Global Context
  1.3 Why This Research?
  1.4 Scope And Limitations
3 2 Evaluation Of Population Control Programmes : An Overview 15-21
658.41 KB
  2.1 Selected Models Relating To Economic Benefits Of Population Control Progammes 22-44
  2.2 A Review Of Selected Evaluation Studies Of Pakistan ‚€™s Population Control Programme 45-54
  2.3 Averted Births Based( Abb ) Benefit/Cost Model Developed For The Present Study 55-77
4 3 Evolution Of Pakistan ‚€™s Population Policy( 1947-1993)
954.85 KB
  3.1 Pakistan ‚€™s Five-Year Plans And Population Control Measures 107-137
  3.2 Application Of Abb Model To Pakistan‚€™s Investment In Population Control 138-161
5 4 Findings Of Abb Model 162-175
1340.51 KB
  4.1 Predication Properties Of Abb Model: Application Of Multiple Regression Analysis
  4.2 Conclusions And Recommendations 191-213
  4.3 Bibliography 214-254
  4.4 Appendices 255-262