Suchergebnisse

In the last decade, Pakistan's external debt obligations have
risen to an unprecedented level. This is despite the fact that the
country had been able to borrow on concessional terms from international
organizations and foreign governments unlike many other developing
countries. The situation has raised concern about the viability of the
strategy of excessive dependence on foreign sources and the problems it
poses for sustainable growth. Between 1970 and 1980 Pakistan's external
debt grew at an average rate of 11.3 percent. Althol1gh, during the
Eighties it has grown at a much slower rate, i.e. 2.37 percent, but by
1986-87 the level of total external debt had reached more than 12
billion U.S. dollars. A notable feature of this change has been that
since the mid-Seventies the debt service payments have increased at a
much faster rate compared with the outstanding debt.

Its been long recognized that various economies of the world
are interlinked through international trade. The experience of the past
several years, however, has demonstrated that this economic
interdependence is far greater than was previously realized. In this
context, the importance of international economic theory as an area
distinct from general economics hardly needs any mentioning. What gives
international economic theory this distinction is international markets
for some goods and effects of national sovereignty on the character of
economic activity. Wilfred Ethier's book, which incorporates recent
developments in the field, is an excellent addition to textbooks on
international economics for one- or twosemester undergraduate courses.
The book mostly covers standard topics. A distinguishing feature of this
book is its detailed analysis of the flexible exchange rates and a
discussion of the various approaches used for their determination.
Within each chapter, the author has extensively used facts, figures and
major events to clarify the concepts in the light of the theoretical
framework. The book also discusses, in a fair amount of detail, the
existing international monetary system and the role of various
international organizations.

In recent years, remittances, especially from the Middle East
(ME), have become an important source of foreign exchange earnings for
Pakistan. The absolute amount of these remittances, over the last
several years, have been so large, that they were bound to have a
significant impact on the Pakistani economy, through improving its
balance of payments position and reducing its dependence on external
financing. For example, in 1982-83 the inflow of remittances from the
Middle East to Pakistan, through official channels, was 2.4 billion U.S.
dollars which was 70 percent of total exports of goods and non-factor
services. The recent decline in oil prices and the slowing down of
economic activity in the Middle East, however, has resulted in the
reduction of the inflow of remittances. The main concern, now, is what
would the level of remittances be in future years and how will the
economy readjust itself to the reduced inflow of the remittances.

This paper analyses impacts of unilateral income and capital
transfers on welfare and terms of trade of the recipient and donor
countries within a two-country framework. Introduction of the external
economies of scale, helps in explicitly incorporating the differences in
factor endowment between developed and developing economies in the
analysis. The paper discusses the conditions under which unilateral
capital transfer from a developed country may yield paradoxical result,
i.e. immiserize the developing country, despite market stability. The
analysis reinforces Brecher and Choudhri's analytical support to
Singer-Prebisch thesis from a new angle.

Economic growth is one of the most important objectives of
development policy in almost every country. It depends on the historical
accumulation of primary factors of production, e.g. labour and capital,
and on technological progress and a combination of socio-political and
institutional factors. Owing to interactions among these different
factors, it is difficult to delineate the role of each factor in
economic growth. It is precisely because of this that a systematic and
quantitative study of the sources of growth is indispensable. The
growth-accounting framework, introduced by Solow [15] to measure
productivity change and subsequently extended by Jorgenson and Griliches
[5], Christensen and Jorgenson [1], Hulten [4] and Denison [2], provides
an important method with which to study the growth experience of a
country.

It is now generally accepted that the real exchange rate is a
key relative price in an econom/ Changes in the real exchange rate
influence foreign trade flows, balance of payments, the structure and
level of production, allocation of resources, etc. While the real
exchange rate is an endogenous variable that responds to both exogenous
as well as policy-induced shocks, the nominal exchange rate is usually
taken as a policy instrument. The two rates, however, are found to be
related to each other. 2 For effective policy-making, it is imperative
to have some idea about different factors that influence the real
exchange rate. Equally important is the knowledge of the manner in which
the real exchange rate responds to changes in the exogenous variables.
While there is a general consensus that the impact of various exogenous
shocks on the exchange rate is transmitted through four broad channels,
namely, (i) absolute prices, (ii) relative prices, (iii) income, and
(iv) interest rates, the relative importance of each of these channels
is found to vary across countries. In general, it depends on the degree
of openness of the economy and the relative effectiveness of the fiscal
and the monetary sectors within a country.

In recent yean, due to a virtual unanimity about the critical
role of hmnan capital in economic development, increased efforts are
being made in the developing countries to eradicate illiteracy. Despite
a significant increase over time in the number of educational
institutions and the government's expenditure on education in Pakistan,
the performance of the education sector in terms of output has been at
best meagre. This non-correspondence between the growth in the
educational institutions and the resultant output implies that failure
to enlist the participation of the population in education can hardly be
attributed exclusively to an insufficiency of the schools. To the extent
that child schooling reflects parental capacity to invest in hmnan
capital formation, there is a need to reckon with factors bearing
parental decision regarding child schooling. This paper investigates
family's decision regarding child schooling through an assessment of the
determinants of child school-enro1ment, using choice theoretic
framework. The regression results are indicative of the influence of
household status, both economic and social, on the propensity to invest
in child schooling. A positive association between the household income,
parental education, and tenurial status as land-owner bear out the
importance of these factors in shaping the household's decision
regarding investment in human capital formation. The study also fmds
traces of the quantity-quality trade-off in family's preferences
regarding the nmnber of children, and it is found to be male-specific.
The most disturbing fmding of the study appears to be the predominance
of the influence originating from parental education. It is this
inter-generational transfer of human capital which needs more attention
as it also implies that illiteracy, and hence poverty, of the parents
gets transmitted to the off-spring. The analysis also brings out the
fact that the labour market hiring practices serve as an important
feedback to the household's human capital formation
behaviour.

This study aims to examine the pattern of households'
expenditure on fuel consumption in Pakistan using the data of Household
Income and Expenditure Survey (1984-85). Price and income elasticities
have been estimated by applying the Extended linear Expenditure System.
It is found that the expenditure pattern of the rural households is
different from the urban households, with the rural households spending
proportionately more on fuels. The estimates of the income elasticities
imply that all fuels are a necessity for both urban and rural
households. The price elasticities of different fuels are found to be
extremely low, implying that the Consumption of fuels in Pakistan is
highly price inelastic.

Domestic resource mobilization is one of the key determinants
of sustained economic growth. Pakistan's perfonnance with regard to
domestic resource mobilization has been poor despite maintaining a
respectable economic growth rate. Why is the savings rate so low in
Pakistan? In this paper we analyse the household savings behaviour in
Pakistan, using micro level data of the Household Income and Expenditure
Survey (HIES) for the year 1984-85. Three different non-linear savings
functions attributed to Keynes, Klein, and Landau are estimated
separately for the urban and the rural households, using the Ordinary
Least Squares (OLS) technique. It is found that the average income and
saving of an urban household are considerably higher than those of
overall Pakistan or a rural household. However, contrary to the general
belief, it is found that the propensity to save of the rural households
is much higher than that of their urban counterparts. The dependency
ratio and the various categories of education are found to have a
negative influence on household savings. No systematic relationship is
found between savings and the employment status and occupation of the
household head. It is found, however, that saving increases with age but
tends to decline when the age crosses a certain limit - a finding
consistent with the Life Cycle Hypothesis.

This paper examines the household consumption patterns
separately for the urban and the rural sectors in Pakistan by estimating
the marginal expenditure shares and expenditure elasticities, for twelve
broad commodity groups, using household level data for the year 1984-85.
At the sectoral level, the marginal expenditure shares are estimated
both with and without the 'community effect'. Furthermore, by dividing
households within each sector into different income groups,
income-specific marginal expenditure shares and elasticities are also
obtained. This level of disaggregation reveals much richer consumption
patterns as compared to the ones based on grouped data. The estimated
marginal expenditure shares indicate that in examining the household
consumption pattems one can safely assume that all the households in the
sample face the same price structure. While the fmdings of the paper
support the validity of Engel's Law, the estimates presented indicate
that expenditure elasticities for different commodity groups vary with
income and, in general, exhibit a cyclical pattern, which is explained
in terms of quantitative as well as qualitative changes in the
households' consumption basket. For a majority of the commodity groups,
both structural and behavioural differences in the consumption patterns
are found to exist between the urban and the rural households.
Furthermore, our results also confirm the existence of economies of
scale in the consumption of majority of the commodity groups. The
degrees of these economies of scale are not only different across
commodities but also between sectors and across the income groups within
each sector.