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Does the Labor Market Structure Explain Differences in Poverty in Rural Punjab?

Listed author(s):
  • Rashid Amjad


    (Pakistan Institute of Development Economics (PIDE),Islamabad, Pakistan.)

  • G. M. Arif


    (Pakistan Institute of Development Economics (PIDE),Islamabad, Pakistan.)

  • Usman Mustafa


    (Pakistan Institute of Development Economics (PIDE),Islamabad, Pakistan.)

The main focus of this study is Rural Punjab and it contributes to regional poverty research in two ways; first, using a more recent household survey data, carried out in August 2007 by the Pakistan Institute of Development Economics (PIDE), it provides fresh poverty estimates for the rural areas of the Punjab. Second, the poverty differential across the agro-climatic zones of Punjab have been explained by urbanization, overseas migration and the labor market structure operating in these zones. This study shows four major factors that explain inequalities in poverty levels. First, the rural areas of two zones, barani and rice/wheat, are well integrated with urban settings. This integration has allowed their rural populations to work in the industrial sector of Central Punjab and the services sector in North Punjab primarily Rawalpindi and Islamabad. Second, the belt from Lahore to Attock in the Punjab has benefited the most from overseas migration. The flow of remittances has helped in reducing poverty levels. Third, the cotton/wheat and low intensity zone still largely depend for employment on the agricultural sector while this dependency is very low in the barani zone, which has good opportunity to seek job opportunities for its labor force in the armed services and government departments. Finally, demographic and social factors including education are less favorable in the cotton/wheat and low intensity zones which negatively impacts on a breakthrough in poverty reduction.

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Article provided by Department of Economics, The Lahore School of Economics in its journal Lahore Journal of Economics.

Volume (Year): 13 (2008)
Issue (Month): Special Edition (September)
Pages: 139-162

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Handle: RePEc:lje:journl:v:13:y:2008:i:sp:p:139-62
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  1. G. M., Arif & Ahmad, Munir, 2001. "Poverty across the agro- ecological zones in rural Pakistan," MPRA Paper 37681, University Library of Munich, Germany.
  2. Haroon Jamal & Amir Jahan Khan & Imran Ashraf Toor & Naveed Amir, 2003. "Mapping the Spatial Deprivation of Pakistan," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 42(2), pages 91-111.
  3. G. M. Arif & Faiz Bilquees, 2007. "Chronic and Transitory Poverty in Pakistan: Evidence from a Longitudinal Household Survey," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 46(2), pages 111-127.
  4. Gutierrez, Catalina & Orecchia, Carlo & Paci, Pierella & Serneels, Pieter, 2007. "Does employment generation really matter for poverty reduction ?," Policy Research Working Paper Series 4432, The World Bank.
  5. Sohail j. Malik, 1992. "Rural Poverty in Pakistan: Some Recent Evidence," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 31(4), pages 975-995.
  6. G.M. Arif, 2006. "Poverty Targeting in Pakistan: The Role of Zakat and the Lady Health Worker Program," Chapters,in: Poverty Strategies in Asia, chapter 7 Edward Elgar Publishing.
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