Khan, Rana Ejaz Ali and Nawaz, Muhammad Atif and Hussain, Altaf (2011): Impact evaluation of structural adjustment program: a case of Pakistan. Published in: European Journal of Economics, Finance and Administrative Sciences No. 29 (2011): pp. 1450-2275.
Download (69kB) | Preview
We analyzed the effect of Structural Adjustment Program (SAP) on macroeconomic variables of Pakistan using annual time series data for the years 1981-2001. The impact of four policy instruments of SAP, i.e. reduction in budget deficit, increase in indirect taxes,adjusting the exchange rate and sliding down of subsidies, on employment, income distribution, per-capita income and inflation has been analyzed. It is found that the first policy instrument, i.e. decrease in budget deficit has affected employment, income distribution and inflation adversely. The second policy instrument of imposition of indirect tax negatively affected the employment, income distribution, per capita income and positively affected the inflation. The third policy instrument of SAP was adjustment of exchange rate. It is estimated that adjusting exchange rate has resulted into increased unemployment and inflation. The fourth policy instrument of shrink in subsidies augmented the unemployment, unequal distribution of income and inflation and dwindled the percapita income. It appears that SAP has adversely affected the major socioeconomic variables of the economy. Currently the government is considering for loan from IMF, so it is proposed to avoid such type of policy directives from IMF.
|Item Type:||MPRA Paper|
|Original Title:||Impact evaluation of structural adjustment program: a case of Pakistan|
|English Title:||Impact evaluation of structural adjustment program: a case of Pakistan|
|Keywords:||Structural Adjustment Program, Budget deficit, Indirect taxes, Exchange rate, Subsidies, Employment, Income distribution, Per-capita income, Inflation,Pakistan|
|Subjects:||D - Microeconomics > D7 - Analysis of Collective Decision-Making > D73 - Bureaucracy ; Administrative Processes in Public Organizations ; Corruption
E - Macroeconomics and Monetary Economics > E6 - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook > E62 - Fiscal Policy
C - Mathematical and Quantitative Methods > C3 - Multiple or Simultaneous Equation Models ; Multiple Variables > C33 - Panel Data Models ; Spatio-temporal Models
D - Microeconomics > D8 - Information, Knowledge, and Uncertainty > D80 - General
|Depositing User:||Rana Ejaz Ali Khan|
|Date Deposited:||22. Nov 2011 13:06|
|Last Modified:||07. Oct 2015 21:25|
Ali, K. (2003) “Gender Exploitation: From Structural Adjustment Policies to Poverty Reduction Strategies”, The Pakistan Development Review, 42(4):669-694.
Amjed, R. and A. R. Kemal (1997) “Macroeconomic Policies and their Impact of Poverty Alleviation in Pakistan”, Pakistan Development Review, 36(1):39-68.
Anwar, T. (1996) “Structural Adjustment and Poverty: The Case of Pakistan”, Pakistan Development Review, 35(4):911-926.
Baro,R. J. and J. Lee (2005) “IMF Program: Who is Chosen and What are the Effects”. NBER Working Paper No.8951.
Beneria, L. (1995) The Mexican Debt Crisis: Restructuring the Economy and the Household, in Beneria, L. and S. Feldman (eds.) Unequal Burden: Economic Crisis, Persistent Poverty and Women’s Work. Westview Press, Oxford.
Bengali, K. and Q. A. Masood (2001) “Stabilization Policy vs. Growth-Oriented Policy Implication for the Pakistan Economy”, The Pakistan Development Review, 40(4):453-466.
Bretton Woods Project (2004) “The World Bank and IMF at Sixty”, at http://www.brettonwoodproject.org.
Dollar, D. and J. Svensson (2000) “What Explains the Success or Failure of Structural Adjustment Program?” Economic Journal, 110:897-917.
FBS (1999) 50 Years of Pakistan in Statistics. Federal Bureaus of Statistics (FBS), Ministry of Finance, Islamabad. FBS (Various Issues) Labor Force Survey. Federal Bureau of Statistics (FBS), Ministry of Finance, Islamabad.
Fourguignon, F., J. D. Melo and A. Suwa (1989) Distributional Effects of Adjustment Policies. Simulations for Two Archetype Economies. Background Paper for 1990 World Development Report. The World Bank,Washington, D.C.
Gardezi, H. N. (2004) “Globalization and Pakistan Dilemma of Development”, The Pakistan Development Review, 43(4):423-440.
Goldstein, M. and P. Moniel (1985) Evaluating Fund Stablization Program with Multi-country Data: Some Methodological Pitfalls. IMF Staff Papers 33(2):304-344.
Haque, N. U. and M. Khan (1980) “Do IMF Supported Programs Work? A Survey of the Cross-country Empirical Evidence”, IMF Working Paper No.169. IMF Washington, D.C.
Iqbal, H. (1994) “Macroeconomic Effects of Adjustment Lendings in Pakistan”, The Pakistan Development Review, 33(4):1011-1031.
Iqbal, Z. and S. Rizwan (1998) “The Impact of Structural Adjustment on Income Distribution in Pakistan: A SAM-based Analysis”, The Pakistan Development Review, 37(4):377-397.
Jaffery, S. M. Younas and A. Khattak (1995) Income, Inequality and Poverty in Pakistan.Pakistan Economic and Social Review, 33,1-2,37-58.
Jamal, H. (2003) “Poverty and Inequality during the Adjustment Decades: Empirical Findings from Household Survey”, The Pakistan Development Review, 42(2):125-135.
Kakwani, N. (2001) “On Specifying Poverty Lines”, Paper delivered at the Asia and Pacific Forum on Poverty Reforming Policies and Institutions for Poverty Reduction. Asian Development Bank, Manila.
Kemal, A. R. (1994) “Structural Adjustment, Employment, Income Distribution and Poverty”,The Pakistan Development Review, 33(4):901-914.
Kemal, A. R. (2003) Structural Adjustment and Poverty in Pakistan. Pakistan Institute of Development Economics. Islamabad.
Khan, M. (1990) “The Macroeconomic Effects of Fund-supported Adjustment Program”, IMF Staff Papers, 37:195-231.
Khan, M., P. Montiel and N. Haque (eds.) (1991) Macroeconomic Models for Adjustment in Developing Countries. International Monetary Fund (IMF), Washington, D.C.
Martin, R. and A. Segura-Ubiergo (2004) Social Spending in IMF-Supported Programs. IEO Background Paper No. 04-1. Independent Evaluation Office. International Monetary Fund, Washington, D.C.
Naiman, R. and M. Watkinson (1999) A Survey of the Impacts of IMF Structural Adjustment in Africa: Growth, Social Spending and Debt Relief. Report of Center for Economic and Policy Research. World Bank, Washington, D.C.
Rafi, S. and R. Shaheen (1996) “Structural Adjustment, Industrialization, and Export Promotion”, The Pakistan Development Review, 35(4):467-480.
Ramakrishnan, U. and J. Zalduendo (2006) The Role of IMF Support in Crisis Prevention. IMF Working Paper WP/06/75. International Monetary Fund (IMF), Washington, D.C.
Rdelet, S. and J. Sachs (1998) “The East Asian Financial Crisis: Diagnosis, Remedies,Prospects”, Brookings Papers on Economic Activity, 1:1074.
SBP (Various Issues) Pakistan Economic Survey. State Bank of Pakistan (SBP). Islamabad.
Subramanium, A. (1997) “The Egyptian Stabilization Experience: An Analytical Retrospective”, IMF Working Paper 97/105. IMF Washington, D.C.
World Bank (1995) Bangladesh from Stabilization to Growth: Country Study. World Bank, Washington, D.C.