Sources of Income Inequality in Pakistan

Hans de Kruijk
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Hans de Kruijk: Erasmus University Rotterdam, the Netherlands.

The Pakistan Development Review, 1987, vol. 26, issue 4, 659-672

Abstract: In a paper presented at the 1985 Conference of this Society [Kruijk and Leeuwen (1985)] we described some structural changes in poverty and income inequality in Pakistan during the 1970s. All inequality measures and poverty indicators pointed to the conclusion that poverty has declined while at the same time inequality has increased. Htlwever, the paper did not go deep enough into the reasons why inequality has increased. It did appear that neither the urban/rural distinction nor interprovincial income differences are important determinants of overall income inequality in Pakistan 1 so that these elements cannot contribute much to explaining changes in inequality. In his comments, Kernal, (1986) suggests to extend the applied decomposition technique by decomposing income also into its sources. This is precisely the purpose of the present paper.

Date: 1987
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