THE CAUSES AND CONSEQUENCES OF POVERTY IN PAKISTAN

Abstract

Pakistan is an under developed country facing economic downturns which directly and indirectly give birth to poverty. Eradication of poverty is very important as its presence causes hurdles in the path of growing economy. Among numerous factors causing poverty, this research has analyzed few factors i.e. low literacy rate, population pressure, inflation and unemployment. Hypotheses were tested using 10 years data i.e. from 2001 to 2010. Multiple regression and simple regression was used which concluded that all the variables have significant relationship whether when taken as a model or individually. Beta values showed that population pressure and unemployment are positively associated where as Inflation and low literacy rate are negatively associated with poverty. The inverse relationship of inflation and low literacy rate with poverty can be due to the cause that limited data 10 years were analyzed and in spite of increasing inflation and low literacy rate some other factors are influencing which has result in increase in poverty. However in general observation, all the independent variables studied are positively associated with poverty. The Government of Pakistan is responsible to take effective measures for eradication of root causes of poverty so that the country can prosper