Growth and Sectoral Inequality in Pakistan: 2001-02 to 2004-05

Type Journal Article - Pakistan Economic and Social Review
Title Growth and Sectoral Inequality in Pakistan: 2001-02 to 2004-05
Volume 45
Issue 2
Publication (Day/Month/Year) 2007
Page numbers 141-154
URL TalatAnwar.pdf
Existing work on inequality in Pakistan remains limited to analyzing inequality at regional and province level. Changes in inequality at sectoral level have not received attention. This paper examines within sector inequality and how changes in inequality are associated with growth using the most recent primary data of the two household surveys PIHS, 2001-02 and PSLM, 2004-05. The results show that the household head employed in Financing, Electricity, Manufacturing, and Community services appear to be more affluent than the other sectors’ head. Financing sector turned out to be the most unequal distribution of consumption followed by Mining, Manufacturing and Community services sector. Between 2001-02 and 2004-05 inequality increased in most of the economic sectors, i.e. Agriculture, Manufacturing, Electricity, Construction, Wholesale and Retail Trade, Community and personal services and undefined sector. These sectors employed 87.5% of all head of households in 2004-05. In general, inequality increased in economic sectors, which witnessed a high economic growth. To reduce sectoral inequality, the government can focus policies to equalize the remuneration across sectors via tax and expenditure polices.

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