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Stagflation, the Labor Market Impact, and the Poverty Puzzle in Pakistan: A Preliminary Analysis

Author

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  • Rashid Amjad

    (Vice Chancellor, Pakistan Institute of Development Economics, Pakistan.)

Abstract
This article discusses the impact of the current stagflation in Pakistan on the labor market and poverty. The paper presents a preliminary explanation of why the labor market and poverty impact of the current stagflation may be far smaller than projected in recent studies, especially for the rural economy. The main conclusions that emerge are that (1) The overwhelming expected negative impact of low economic growth, high double-digit inflation, and crippling energy shortages on poverty and the labor market appear to have been cushioned by the large increase in remittances, rising wages in agriculture and services, and social safety nets; (2) there is, however, no reason for complacency since over 20 million people live in absolute poverty and that the economy remains in deep stagflation, (3) the PSLM (HIES) 2010/11 data should be made publicly available so that it can be subject to more critical analysis and (4) studies on poverty should be based on a close integration of macro-sectoral–micro-factors to fully capture the underlying “poverty dynamics.”

Suggested Citation

  • Rashid Amjad, 2012. "Stagflation, the Labor Market Impact, and the Poverty Puzzle in Pakistan: A Preliminary Analysis," Lahore Journal of Economics, Department of Economics, The Lahore School of Economics, vol. 17(Special E), pages 51-71, September.
    • Handle: RePEc:lje:journl:v:17:y:2012:i:sp:p:51-71
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    References listed on IDEAS

    as
    1. François Bourguignon & Maurizio Bussolo & Luiz A. Pereira da Silva, 2008. "The Impact of Macroeconomic Policies on Poverty and Income Distribution : Macro-Micro Evaluation Techniques and Tools," World Bank Publications - Books, The World Bank Group, number 6586.
    2. François Bourguignon & Maurizio Bussolo & Luis Pereira, 2008. "The Impact of Macroeconomic Policies on Poverty and Income Distribution," PSE-Ecole d'économie de Paris (Postprint) halshs-00754864, HAL.
    3. Amjad, Rashid, 2010. "Remittances and poverty in Pakistan: a note," MPRA Paper 38297, University Library of Munich, Germany.
    4. Rashid Amjad Chaudhry & Musleh ud Din & Abdul Qayyum, 2011. "Pakistan: Breaking Out of Stagflation into Sustained Growth," Lahore Journal of Economics, Department of Economics, The Lahore School of Economics, vol. 16(Special E), pages 13-30, September.
    5. G. M. Arif & Shujaat Farooq, 2014. "Rural Poverty Dynamics in Pakistan: Evidence from Three Waves of the Panel Survey," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 53(2), pages 71-98.
    6. Rashid Amjad & G. M. Arif & M. Irfan, 2012. "Preliminary Study: Explaining the Ten-fold Increase in Remittances to Pakistan 2001-2012," PIDE-Working Papers 2012:86, Pakistan Institute of Development Economics.
    7. S. M. Naseem, 2012. "A Review Of Studies On Poverty In Pakistan: Origin, Evolution, Thematic Content And Future Directions," PIDE Books, Pakistan Institute of Development Economics, number 2012:1 edited by Rashid Amjad.
    8. Rashid Amjad & A.R. Kemal, 1997. "Macroeconomic Policies and their Impact on Poverty Alleviation in Pakistan," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 36(1), pages 39-68.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Rashid, Amjad, 2012. "Generating Decent Work:How labour market institutions matter," MPRA Paper 60072, University Library of Munich, Germany, revised Jan 2013.
    2. Vaqar Ahmed & Muhammad Zeshan, 2014. "Decomposing Change in Energy Consumption of the Agricultural Sector in Pakistan," Agrarian South: Journal of Political Economy, Centre for Agrarian Research and Education for South, vol. 3(3), pages 369-402, December.
    3. Muhammad Shahid Hassan & Haider Mahmood & Muhammad Ibrahim Saeed & Tarek Tawfik Yousef Alkhateeb & Noman Arshed & Doaa H. I. Mahmoud, 2021. "Investment Portfolio, Democratic Accountability, Poverty and Income Inequality Nexus in Pakistan: A Way to Social Sustainability," Sustainability, MDPI, vol. 13(11), pages 1-16, June.
    4. Amjad, Rashid, 2015. ""Expanding employment opportunities: Embedding "Human Utilisation" in the Post-2015 MDGs", in Tanuka, E., S. Mazumdar and M. Sengupta ed.,Human Development in the Global South: Eme," MPRA Paper 63791, University Library of Munich, Germany.
    5. Rashid Amjad, 2014. "Pakistan’s Growth Spurts and Reversals: A Historical Perspective," Lahore Journal of Economics, Department of Economics, The Lahore School of Economics, vol. 19(Special E), pages 91-104, September.
    6. Amjad, Rashid & Yusuf, Anam, 2014. "More and better jobs for Pakistan: Can the manufacturing sector play a greater role," MPRA Paper 59518, University Library of Munich, Germany.

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    More about this item

    Keywords

    Macro-dynamics; economic growth; cycles; Pakistan.;
    All these keywords.

    JEL classification:

    • P46 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - Consumer Economics; Health; Education and Training; Welfare, Income, Wealth, and Poverty
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies

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