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Impact of poor governance and income inequality of poverty in Pakistan

Author

Listed:
  • Zainab Akram

    (Lecturer, COMSATS Institute of Information Technology, Lahore, Pakistan)

  • Sajida Wajid

    (Lecturer, Minhaj University, Lahore, Pakistan)

  • Tahir Mahmood

    (Assistant Professor, University of Veterinary and Animal Sciences, Lahore, Pakistan)

  • Shoaib Sarwar

    (Research Scholar, University of the Punjab, Lahore, Pakistan)

Abstract

The widespread poverty is due to two main reasons are poor governance and income inequality in Pakistan. Few studies have focused on the theoretical substantiation of impact of bad governance and income inequality on poverty but we do not find any study carrying empirical work on the impact of bad governance on poverty in Pakistan. This study is an empirical research that attempts to find out the long run and short run impact of poor governance and inequality in wealth and income distribution on poverty in Pakistan through time series analysis for the year 1984-2008. Autoregressive Distributive Lag (ARDL) Approach to Co integration is applied in order to find out the short run and long run relationship between the variables. Co integration between poverty, poor governance and income inequality is found in the present study. The results of this study also confirm the positive relationship between poverty and income inequality both in short run and long run. Poor governance is found to positively affect poverty in the long run but in the short run it does not have significant impact on poverty in Pakistan. CUSUM and CUSUMQ stability tests are employed on the model and the results show there is a stable relationship between the variables indicating stability of the estimated model.

Suggested Citation

  • Zainab Akram & Sajida Wajid & Tahir Mahmood & Shoaib Sarwar, 2011. "Impact of poor governance and income inequality of poverty in Pakistan," Far East Journal of Psychology and Business, Far East Research Centre, vol. 4(4), pages 43-55, September.
    • Handle: RePEc:fej:articl:v:4c:y:2011:i:4:p:43-55
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    References listed on IDEAS

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    Cited by:

    1. Saleemi, Muhammad Waqar & Amir-ud-Din, Rafi, 2019. "How does quality of governance influence occurrence of crime? A longitudinal analysis of Asian countries," MPRA Paper 94142, University Library of Munich, Germany.
    2. Tasos Stylianou & Rakia Nasir & Muhammad Waqas, 2023. "Inclusive Human Development and Governance Nexus: Causality Analysis of Selected Asian Countries," Economies, MDPI, vol. 11(3), pages 1-14, March.
    3. Waqas Ahmad, 2022. "The Role of Islamic Microfinance in Poverty Alleviation: Evidence from Pakistan," Journal of Economic Impact, Science Impact Publishers, vol. 4(1), pages 39-49.
    4. Malik, Zahra & Zaman, Khalid, 2013. "Macroeconomic consequences of terrorism in Pakistan," Journal of Policy Modeling, Elsevier, vol. 35(6), pages 1103-1123.
    5. Muhammad Shahid Hassan & Samra Bukhari & Noman Arshed, 2020. "Competitiveness, governance and globalization: What matters for poverty alleviation?," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 22(4), pages 3491-3518, April.
    6. Egla Mansi & Eglantina Hysa & Mirela Panait & Marian Catalin Voica, 2020. "Poverty—A Challenge for Economic Development? Evidences from Western Balkan Countries and the European Union," Sustainability, MDPI, vol. 12(18), pages 1-24, September.

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    More about this item

    Keywords

    Poverty; Poor Governance; Income Inequality; ARDL;
    All these keywords.

    JEL classification:

    • M1 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration

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