Government Spending, Economic Growth and Rural Poverty in Pakistan.

Type Journal Article - Pakistan Journal of Social Sciences (PJSS)
Title Government Spending, Economic Growth and Rural Poverty in Pakistan.
Author(s)
Volume 32
Issue 2
Publication (Day/Month/Year) 2012
Page numbers 469-483
URL http://www.bzu.edu.pk/PJSS/Vol32No22012/Final_PJSS-32-2-15.pdf
Abstract
The economic growth in Pakistan is volatile and unstable because of dependency of foreign debts and unstable political and law and order situation of the country. Agriculture, being the largest sector of Pakistan economy, accounts for more than one-fifth of GDP and employs nearly half of the work force as well. Therefore, growth in agriculture sector is closely associated with movements in poverty. In Pakistan, the growth performance of agriculture over a few decades remained volatile. This study tries to interpret the poverty linkages with the said variables in different provinces of Pakistan as rural Sindh seems to be more vulnerable than other regions of the country. The results show a robust improvement in foreign direct investment especially in manufacturing and agriculture sector leads to higher capital accumulation, while higher government spending on infrastructure, rural development and other safety net programs leads to generate more opportunities of employment especially for unskilled labour in rural areas. The present study concludes that there is a need to protect integrity of the country by taking some bold steps which is the need of the hour and may be helpful in raising the pace of economic development.

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