Measuring Income Inequality in Punjab Province for Financial Assessment: Evidence from Household Data

Abstract

Income Inequality and Poverty has been a great challenge for majority of the developing and developed countries of the world. The basic causes of Income Inequality and Poverty are the discrimination in fundamental essential rights such as education, health and economic opportunities in a country. This study was conducted to assess the income inequality in Punjab Province of Pakistan. It also measured the inequality situation of rural areas of the Province. Household Integrated Economic Survey (HIES) data of the year 2018-19 was obtained from Pakistan Bureau of Statistics, Islamabad. This research endeavor has used a combination of inequality techniques including Lorenz curve and Deciles Method to estimate income inequality prevailing in the study area. Major findings reveal that there was 43.15 percent income inequality exists within Punjab in the year 2018-19. Correspondingly, in rural region of the Punjab, the inequality of income was observed as 41.27 percent. It is therefore, recommended that the wage level of labors working in different professions of Punjab should be improved in order to eliminate the severity of income inequality from the Punjab Province of Pakistan.