Impact of Poor Governance and Income Inequality on Poverty in Pakistan

Chaudhry et al. (2006) linked urban poverty with the idea of good governance. They used primary data source and inferred that people in the weakest state and extremely deplorable condition tend to become most abandoned and helpless in the presence of poor governance, because they are extremely powerless in controlling decisions that influence their lives. They also proposed that urban poverty can be mitigated at the level of city by way of good governance in demographic and socio-economic factors and infrastructure. Pasha (2000) determined nine components of “good economic governance” as achieving “fiscal discipline”, “growth with equity”, “institutional capacity”, “protection of public interest”, “credibility and consistency”, “capacity to manage crisis”, “effective delivery of services”, “integrity and sovereignty” and indicated that economic performance of Pakistan on the basis of measures of good economic governance, was a mixture signifying deterioration and downfall in 1990s. He recommended that economic management and governance in Pakistan has to be excellent if Pakistan has to achieve above average economic growth and reduced poverty levels. Sumarto, Suryahadi and Arifianto (2004) empirically examined the impact of bad governance on poverty alleviation in Indonesia. Their study showed that the poor are thoroughly affected by bad governance and it sabotages the efforts made to decrease poverty. They found evidence on the impact of poor governance on poverty alleviation and showed that poverty reduction was faster in areas that exercise better and improved governance. Anwar (2006) is of the view that had the governance indicators improved in Pakistan, the reduction in poverty would have been much faster; and proposed that t...

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