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Title of Thesis  
AN ANALYSIS OF PAKISTAN’S POVERTY PROBLEM AND ITS ALLEVIATION THROUGH INFAQ  
Author(s)  
NASIM SHAH SHIRAZI  
Institute/University/Department Details  
International Islamic University, Islamabad/Islamic Economics  
Status (Published/ Not Published/ In Press etc)  
Published  
Date of Publishing  
1994  
Subject  
Economics  
Number of Pages  
226  
   
Keywords (Extracted from title, table of contents and abstract of thesis)  
Poverty, Infaq, Poverty lines, Poverty gap, Zakat, Ushr, Nutrition based poverty lines, Socioeconomic characteristics,  

 

 
Abstract  

The objective of this undertaking is to determine the incidence of poverty and to identify socioeconomic profiles of the poor in Pakistan. In addition to exploring the possibility of alleviation of poverty through the 'Infaq' an attempt has been made in this study to ascertain the prospects of bridging the poverty gap through the official 'zakat' and 'ushr' collections. The role of different characteristics, that determine poverty status of a household, has also been investigated in the present study. The nutrition based poverty lines both in terms of expenditures and income were estimated using Household Income and Expenditure Survey J 987-88 micro data. For the purpose of determining poverty lines in terms of' expenditures the relationship between daily calorie intake per adult equivalent and monthly total consumption expenditure per adult equivalent were estimated. The expenditure based poverty lines were converted into income based poverty lines by regressing the total expenditure per adult equivalent per month on income per adult equivalent per month. Headcount (P0), poverty gap (P1) and Foster, Greer and Thorbecke (FGT) poverty measure (P2), which are widely used in the recent research done on poverty, were utilized for estimating the incidence of poverty in the present study. The FGT measures are additively decomposable by households (population) sub-groups; as a result the aggregate poverty can be represented as an appropriately weighted sum of poverty levels in the component-sub-groups of households (population). To ascertain the role of 'infaq', in alleviation of poverty the amount of 'infaq' income received by the households was deducted from their total income and the P0, P1 and P2 indices were re-estimated. Thus the difference between both the results (with and without 'infaq') showed the impact of 'infaq' on poverty alleviation. The Logit model was used in this study for evaluation of the role of different characteristics that determine poverty status of household. The incidence of poverty was estimated both at the population and the household levels. Our findings are that the incidence of poverty is sensitive to the poverty line selected. The incidence of poverty in terms of persons is higher than that of households. This could be due to the fact that incidence of poverty is relatively higher among the larger households, which are likely to represent, a larger proportion or the population. Another finding of the study is that the incidence of poverty in terms of income poverty lines is higher than that estimated in terms of expenditure based poverty lines. Our estimates suggest that poor households are disproportionately located in the rural areas of Pakistan. More than 85 percent of the total poor households are residing in the rural areas of Pakistan. Punjab contributes 72.71 percent of poor households, followed by Sindh (12.75 percent) to all the poor households of the country. The share of NWFP in the poor households is 12.08 percent, while Baluchistan has the lowest share (2.45 percent). Malik's index to ascertain the locational concentration of the poor households was also estimated. These estimates suggest that the rural areas of Pakistan have the relatively higher proportion of the poor households than their share in the total population. The decomposition of the poor households according to the socioeconomic characteristics of the heads of the households was also carried out in the study. Our findings in this regard are: The majority of the male headed poor households fall in the age group of 40 -49, while the majority of female headed poor households fall in the age group of 30-39. Classification of the poor according to the marital status shows that about 95 percent of the male heads of the poor households are married and 70 percent of the female heads of the poor households are married. It implies that household headed by the married persons are more exposed to poverty risk. The proportion of poor households having highly educated heads is extremely low. Majority of the educated heads of the poor households falls in the primary or below matric category of education. Our results indicate that more than 90 percent of the male heads of the poor households fall in the working class category, while about 80 percent of the female heads of the poor households fall in the non-working class category. The occupational classification of the heads of the poor households shows that the majority of the male heads of the poor households are in the agricultural, animal husbandry and forestry', followed by production and related workers, transport equipment operators and labourers' categories. The proportion of female heads of the poor households belonging to the category of 'professional, clerical and related workers' is the highest (81.0 percent in over all Pakistan). The decomposition of the households according to the industrial activities suggests that most of the male heads of the poor households are engaged in the agriculture, forestry, hunting and fishing, followed by construction. While most of the female heads of the poor households fall in the category of activities not adequately defined. The breakdown of employment status of the heads shows that most of the male or female heads of the poor households are classified as self-employed, and they are followed by the category of employees. The earning status of the households reveals that the proportion of the households with single earner is the highest in case of male headed households, while in case of female headed poor households; the majority falls in the category of no earner. The proportion of poor households is relatively high in case of large sized households. The highest proportion of the male headed poor households is found in case of households having 7 to 8 members and in case of female headed households, those having 5 to 6 members. The Results of the Logit model show that the households living in Punjab have the highest probability of being poor as compared to the other provinces; that as the educational level of the head of the household increases the probability of that household being pour decreases. that as 'lnfaq' increases the probability of a household being poor declines. that the probability of a household being poor declines, when the number of earners in that household increases, that the probability of a household being poor increases with the increases in the size of the household. The effects of 'Infaq, on poverty alleviation, in Pakistan, suggest that 'Infaq, could help in reducing poverty level in Pakistan in terms of head count (P0) by 2.16 percent overall, 3.78 percent in urban areas and 2.06 percent in rural areas. The most important impact of 'infaq' is on the reduction in poverty gap (P1) and severity of poverty index (P2). The poverty gap was reduced by 4.l6 percent in overall Pakistan under the impact of 'infaq'. The 'infaq' helped in decreasing the severity of poverty by 8.6epercent in overall Pakistan. We also estimated the funds required to bring the poverty gap to zero and explored the possibilities of filling this gap by the official zakat collections. Our findings are that the present zakat collections can fill the poverty gap completely of the extremely poor and partially that of the very poor. But in the present form it is not capable of eradicating total poverty. If zakat is collected to its full potential, it could not only result in complete eradication of poverty from the country but also can generate surplus funds.

 
   
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Sr.No Chapter Table of Contents
 
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1 1

INTRODUCTION

1
50.KB
2 2 PERCEPTION OF POVERTY 7
121.KB
3 3 REVIEW OF LITERATURE 17
294.KB
4 4 METHODOLOGY AND DATA 47
250.KB
5 5 DETERMINATION OF POVERTY LINES 71
202.KB
6 6 EXTENT OF POVERTY AND SOCIOECONOMIC PROFIL OF THE POOR 90
552.KB
7 7 INFAQ 138
409.KB
8 8 DETERMINANTS OF POVERTY STATUS OF A HOUSEHOLD 175
94.KB
9 9 CONCLUSIONS 186
106.KB
10 10 APPENDIX 197
165.KB
11 11 PREFERENCES 216
112.KB