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Book Reviews: Rural Credit and Self-Help Groups: Micro-Finance Needs and Concepts in India
Viqar Ahmed
Published:July - Dec 1999
Micro-finance is an idea which occurred to developing countries
considerably late in the day. When during the colonial era, the modern
sector and its peculiar institutional framework emerged in the South Asian
continent, the system catered to the needs of the modern sector i.e. trade
and industry. Agriculture did not receive the kind of attention that it
deserved although colonial rule was responsible for destroying the viability
of this vital sector. A compensatory effort to provide finance for the rural
sector would have been in order. However, this task was left to the cooperatives and informal sources of credit. The governments in the colonial
system only undertook “distress lending” in the form of Taccavi loans on a
somewhat limited scale.
KEYWORDS:
Micro-finance, rural credit, Third World, cheap credit, assessment, India.
JEL:
N/A.
What use is the Neo-Classical Theory of International Trade? Part II: International Trade without Comparative Advantages
Sikander Rahim
Published:July - Dec 1999
The first part of this paper showed that the neo-classical theory of
international trade leads to conclusions that contradict the facts or leads to
no conclusions that can be verified. The version of the theory with two
factors and the same production functions in different countries has some
appeal because relative abundance of factors or intensities of their use have
consistent meaning and make the theory plausible, but it results in the
Leontief paradox and factor price equalisation. This appeal is lost when the
number of factors is greater than two or production functions are not the
same in different countries; relative abundance and intensity can not be
consistently ranked or their connections to the pattern of trade is not the
simple one of the Heckscher-Ohlin theory. Nor does the theory have much
left to say; the kind of verifiable general prediction that was possible with
two factors is not possible when the factors are more than two; such
conclusions as can, in principle, be drawn are specific to the general
equilibrium calculated for a given set of production functions and a given
set of countries, with specified factor endowments and consumer
preferences.
KEYWORDS:
International trade, neo-classical theory, shortcomings, specialisation, models, Heckscher-Ohlin, Haberler, Bensusan-Butt, mechanised production.
JEL:
N/A.
Efficiency Wages in Pakistan's Small Scale Manufacturing
Abid A. Burki
Published:Jan - June 1999
This paper investigates wage differentials between workers in
subcontracting and non-subcontracting firms, using data from a recent
survey of small manufacturing firms in Gujranwala, Pakistan. The paper finds
that subcontracting workers receive a high wage premium and invokes
efficiency wage arguments to explain this differential. The paper argues that
due to a client/vendor monitoring problem it is optimal for subcontracting
firms to pay higher than the market clearing wages. The use of Heckman's
two stage procedure to test for sample selection bias fails to give such
evidence. A decomposition of the wage differentials indicates that
endowment differentials partly explain higher wages for subcontracting
workers while the bulk of this wage gap is explained by differential returns
to workers' attributes.
KEYWORDS:
Small manufacturing firms, Pakistan, allocation of resources, adjustment policies, competitive equilibrium model, cumulative wage growth.
JEL:
N/A.
Valuing Environmental Costs due to Automobile Pollution in Pakistan
M. Qamar uz Zaman
Published:Jan - June 1999
In the current era, increased attention is being paid to protect the
environment in developing countries. The concern stems primarily from
recent advances in information concerning health problems associated with
pollution. The extent of the deep-seated dangers present has motivated
detailed studies and consequent pollution abatement programmes to be
adopted by several countries. However, the evaluation of projects and policy
reform for environmental effects in Pakistan has been rare. The task thus is
posed to provide credible estimates of the benefits that can be provided by
pollution abatement, and the corresponding costs.
KEYWORDS:
Pakistan, automobile pollution, air pollution, environmental costs, air pollutants, gasoline, petrol, emissions, health cost estimates.
JEL:
N/A.
Population Growth - The Social Development and Poverty Dimension
M.S. Jillani
Published:Jan - June 1999
The debate over the relationship of population and development is
now more than 200 years old, starting with the treatise on population by
Malthus, in 1798. The increase in population, ever since, has remained a
matter of concern for economists and development planners. The most
recent high point of the issue was witnessed at Cairo in September, 1994.
The conference which was attended by more than 10,000 persons from all
over the world ended with an agreement on the issues involved in the
growth of population and the economy. The outcome was a Plan of Action
for the next twenty years, which would concentrate on Reproductive Health
in order to obtain, “a state of complete physical, mental and social wellbeing, and not merely the absence of disease or infirmity in all matters
relating to the reproductive system and its functions and process”. This can
be a turn-around in global efforts for human health and welfare, if properly
implemented.
KEYWORDS:
Population growth, plan of action, poverty, industrialization, development, sustainable development, social development, Pakistan.
JEL:
N/A.
Link between Higher Education and the Community - a Model
Rukhsana Zia
Published:Jan - June 1999
Higher Education (HE) in Pakistan presents a case of the "inverted
pyramid". The need of the country is to eradicate illiteracy and yet on the
eve of the new millenium it stands at a humble 45 per cent. Poverty in the
country is on the rise. Given the constraint of the financial resources the
downward spiral is evident and yet the masses at the grassroots level could
greatly benefit from increased literacy skills. Equipping them with functional
literacy skills would clearly improve their quality of life. Given the two
opposing trends whereby the country needs to provide massive literacy skills
to its populace and the infrastructure of education heavily biased in favour
of HE, an innovative approach within the education system and its mode of
delivery is needed. This paper focuses on one such possibility and proposes a
model to develop a link between the two to place the benefits of HE at the
doorstep of the populace where it is desperately needed.
KEYWORDS:
Pakistan, higher education, human development indicators, HDIs, national development programmes, community development unit, CDU, BUNYAD Literacy Community Council, BLCC.
JEL:
N/A.
Major Determinants of Female Child Labour in Urban Multan (Punjab-Pakistan)
Karamat Ali and Abdul Hamid
Published:Jan - June 1999
In recent years, the sensitive issue of child labour has received
world-wide attention and has become the focus of serious discussion in
developing as well as developed countries. Any exact information on child
labour is usually hard to come by as most of the children work in the
unorganised informal sector, which is neither regulated by labour laws nor
is monitored by any organisation. These working children are usually
illiterate and start working at a very early age, are inexperienced and
vulnerable, they usually work long hours in deplorable conditions, have no
medical cover, go without sufficient and proper food and clothing, and get
little rest and recreation. In this paper, an attempt has been made to
analyse the major causes of female child labour in the city of Multan and
certain measures and policies have been suggested which could help in
bringing an end to this inhumane practice. Legislation against child labour
is not an ideal solution in a country such as Pakistan. The child labour
phenomena is not as simple as it appears and needs consideration in the
context of the microeconomics of the family and population growth and
macroeconomics of the social security structure of a country,
unemployment, underemployment, opportunity cost and productivity of
formal education. There are very few studies on child labour in Pakistan
and on female child labour, hardly any study can be found. Data has been
collected for 60 female child labourers, employed as maidservants, baby
sitters and other household activities etc. Most of these female children
work in the houses of educated and well off people who are usually against
child labour. This exploitation of child labour cannot be stopped by child
labour laws only. In this regard, other measures such as more facilities for
education and vocational training are indispensable. A group of social
volunteers comprising workers, employers, government officers, media
experts, members of non-government organisations and educationists
should make earnest and sincere efforts to achieve the objective of
minimising child labour and improve their living conditions as much as
possible.
KEYWORDS:
Child labour, Pakistan, female child labour, legislation, unemployment, formal education, literature, education policy.
JEL:
N/A.
Female Under-representation in Educational Management
Saeeda Shah
Published:Jan - June 1999
The obvious fact of female under-representation in educational
management across cultures and nations is mentioned in every relevant
study. Interestingly this phenomenon transcends the dichotomies such as
developed/under-developed, Eastern/Western, Muslim/non-Muslim, First/
Third World countries. Variations are more often due to situational
differences. For example, the percentage of female representation in higher
education management for the U.S., Britain and China as given by Lyn
Davies is respectively 24, 13, and 26 per cent (1992-6; Also see Coleman:
1996), 20-30 per cent in Pakistan (Ibid:4). These statistics could be
misleading for generalisation purposes if it is assumed that a higher
percentage means more educated women or less gender discrimination. We
know that a comparatively higher percentage of women managers in
Pakistan is because of 'women only' institutions. In the contexts where
management jobs are open to men and women, women are in extremely low
numbers, and the situation is not very different in other countries.
KEYWORDS:
female under-representation, female participation, sex-roles, management, Pakistan.
JEL:
N/A.
What use is the Neo-Classical Theory of International Trade?
Sikander Rahim
Published:Jan - June 1999
International economic policy is now more under the sway of
orthodox economics than it has ever been. The main international economic
institutions, the IMF, the World Bank, the WTO, and the major developed
economies are unremitting advocates of free trade and impose their views on
the developing countries. And the developing countries, whose attempts at
economic development through protection have mostly failed, are on the
whole inclined to accept these views. Over the last twenty years economic
policy in these countries has more and more come to be formulated by
orthodox neo-classical economists, often described in the press as
“reformers”, who advocate more reliance on markets and less protection
against imports.
KEYWORDS:
International trade, neo-classical theory, shortcomings, specialisation, models, Heckscher-Ohlin, Haberler, Bensusan-Butt, mechanised production.
JEL:
N/A.
Note: Analysis of Key Determinants of Tax Policy and Administration
Ahmad Khan
Published:Jan - June 1999
Similar to most countries, the objectives of the taxation system in
Pakistan are not well-defined. Historically, the primary objective has been
resource generation for the government. The taxation system has
simultaneously addressed the secondary objectives of promoting area/sectorspecific economic activities, discouraging undesired imports/production,
encouraging savings and investment. These objectives were met through a
variety of tax concessions and exemptions, rebates and credits, differentiated
tax rates and tariffs. The revenue shortfalls/leakages resulting from
preferential tax treatment of the desired activities were offset through
appropriate changes in various fiscal instruments, e.g. high tax rates and
tariffs, regulatory duties, extended withholding and presumptive taxes,
excise duties on services, and many more. These measures, in turn,
complicated the taxation system and adversely affected the equity, neutrality
and progressivity thereof.
KEYWORDS:
Tax policy, preferential tax treatment, structural reforms, administration, federal revenue.
JEL:
N/A.