MP R A

Munich Personal RePEc Archive

Impact of education on poverty reduction

Masood Sarwar Awan and Nouman Malik and Haroon Sarwar and Muhammad Waqas
Department of Economics. University of Sargodha., Quiad-e-Azam University Islamabad, Pakistan.

2011

Online at http://mpra.ub.uni-muenchen.de/31826/ MPRA Paper No. 31826, posted 24. June 2011 19:33 UTC

IMPACT OF EDUCATION ON POVERTY REDUCTION

Masood Sarwar Awana, Nouman Malikb, Haroon Sarwara, Muhammad Waqasa
a b

Department of Economics. University of ar!o"#a$ Pa%istan. &'ia"(e(A)am University Is*ama+a"$ Pa%istan.

ABSTRACT Poverty is a st'm+*in! +*oc% in t#e ,ay of ac#ievin! economic "eve*opment. Co!ni)ant of t#e essence of Mi**enni'm Deve*opment -oa*s .MD-s/ an" 0E"'cation for A**1 pro!ram$ e"'cation is prom'*!ate" as t#e primary ,eapon a!ainst poverty preva*ence. 2ence it is important to see% o't t#e effect of "ifferent *eve*s of e"'cation 'pon poverty in Pa%istan. T#is st'"y eva*'ates t#e effect of "ifferent *eve*s of e"'cation$ e3perience an" !en"er of t#e emp*oye" in"ivi"'a*s .emp*oyers$ se*f(emp*oye"$ ,a!e earners an" 'npai" fami*y ,or%ers/ as t#e "eterminants of poverty. T#e "ata for t#is tas% comes from t#e 2o'se#o*" Inte!rate" Economic 'rvey .2IE / for t#e years 4556(55 an" 7884(87. A *o!istic re!ression mo"e* is estimate" +ase" on t#is "ata$ ,it# t#e pro+a+i*ity of an in"ivi"'a* +ein! poor as t#e "epen"ent varia+*e an" a set of e"'cationa* *eve*s$ e3perience an" !en"er as e3p*anatory varia+*es. It is fo'n" t#at e3perience an" e"'cationa* ac#ievement is ne!ative*y re*ate" ,it# t#e poverty inci"ence in +ot# years. A*so as ,e !o for t#e #i!#er *eve*s of e"'cation t#e c#ances of a person +ein! non(poor increases. Moreover$ +ein! a ma*e person provi"es an a"vanta!e in retainin! a position a+ove poverty *eve*. Keywords: Poverty$ E"'cation$ Pa%istan ! "NTR#$%CT"#N T#e t#o'!#t t#at e"'cation an" #'man capita* are essentia* for economic !ro,t# .an" fina**y$ for poverty re"'ction/ !aine" m'c# importance in t#e mi" 4558s +eca'se t#e economic pro!ress of East Asian co'ntries . in!apore$ 2on! 9on!$ T#e Rep'+*ic of 9orea an" Tai,an/ in 45:8s an" 4568s ,as primari*y "'e to t#eir investment in e"'cation an" #'man capita* formation ;4<. E"'cation an" poverty are inverse*y re*ate". T#e #i!#er t#e *eve* of e"'cation of t#e pop'*ation$ *esser ,i** +e t#e n'm+er of poor persons +eca'se e"'cation imparts %no,*e"!e an" s%i**s ,#ic# is s'pportive in #i!#er ,a!es. T#e "irect effect of e"'cation on poverty re"'ction is t#ro'!# increasin! t#e earnin!s=income or ,a!es. T#e in"irect effect of e"'cation on poverty is important ,it# respect to 0#'man poverty1 +eca'se as e"'cation improves t#e income$ t#e f'*fi**ment of +asic necessities +ecomes easier an" raises t#e *ivin! stan"ar" ,#ic# s're*y means t#e fa** in #'man poverty. T#e e"'cation in"irect*y #e*ps in t#e f'*fi**ment of +asic nee"s *i%e ,ater an" sanitation$ 'ti*i)ation of #ea*t# faci*ities$ s#e*ter$ an" it a*so affects t#e ,omen1s +e#avior in ferti*ity "ecisions an" fami*y p*annin! ;7<. It is 'n"erstoo" t#at s'c# +asic nee"1s presence increase t#e pro"'ctivity an" ,a!es conse>'ent*y p'ttin! peop*e 4

a+ove t#e poverty *ine. T#e *in%a!es +et,een e"'cation an" poverty +roa"*y can +e seen in t,o ,ays? First*y$ investment in e"'cation increases t#e s%i**s an" pro"'ctivity of poor #o'se#o*"s. It en#ances t#e income *eve* as ,e** as t#e overa** stan"ar" of *ivin! .#'man "eve*opment/. econ"*y$ poverty is a*so a +i! impe"iment in e"'cationa* attainment. Poverty affects t#e e"'cationa* ac#ievement in t#ree "imensions. T#e very first one is from reso'rce(si"e .*earnin! an" financia* reso'rces/$ secon" one is t#e !eneration of s'c# socia* press'res ,#ic# m'ti*ates t#e min"set of poor st'"ent an" *ast*y ,#en poverty !ra+s any instit'tion it "eteriorates t#e teac#in! stan"ar"s ;@<. At macro *eve*$ ,e can !enera**y e3amine t#at poor co'ntries #ave *o, *eve*s of e"'cation an" at micro *eve* c#i*"ren of poor fami*ies "o not atten" sc#oo*s. In Pa%istan$ A.B mi**ion o't(of(sc#oo* c#i*"ren are present in ,#ic# 68C never enro**e" in t#e sc#oo*s ;D<. T#e reasons +e#in" t#e a+sence of poor c#i*"ren in sc#oo*s are economic an" non(economic constraints. For e3amp*e$ ma*e c#i*"ren are consi"ere" as so'rce of income in t#e form of c#i*" *a+orE !ir*s are !enera**y s'pportive to mot#ers in #o'se#o*" ,or% an" in carin! yo'n!er +rot#ers an" sisters. Moreover$ some 'se*ess socia* norms an" so(ca**e" re*i!io's "octrine ar"ent*y restrain !ir*1s e"'cation. 2ence t#e *ac% of e"'cation is a ca'se of *o, earnin! potentia* of any person an" poverty persists in even ne3t !enerations of t#at #o'se#o*". Pa%istan is secon" amon! t#e ,or*" co'ntries ,it# #i!#est n'm+er of c#i*"ren o't of sc#oo*s an" it is +eca'se of severe poverty in Pa%istan ,#ere more t#an A8 percent of t#e pop'*ation *ives on F7 a "ay. It is note,ort#y t#at t#e 0e"'cation poverty1 .*ac% of e"'cation/ an" 0income poverty1 #ave a m't'a**y reinforcin! re*ations#ip ,it# eac# ot#er +ot# at macro an" micro *eve*s. Gac% of e"'cation is a %ey factor of income poverty an" a+sence of s'fficient income=earnin!s can1t overcome t#e e"'cation poverty ;B<. Moreover$ e"'cation #e*ps in t#e f'*fi**ment of +asic nee"s .era"icatin! poverty/ an" +asic nee"s t#emse*ves inc*'"e t#e e"'cation avai*a+i*ity$ #ence provision of e"'cation an" f'*fi**ment of +asic nee"s +ot# reinforce eac# ot#er ;A<. T#e inverse re*ations#ip +et,een e"'cation an" poverty #as +een reco!ni)e" +'t t#ere is a "e+ate re*atin! to t#e e"'cationa* *eve*sE ,#et#er primary e"'cation is eno'!# for t#e '*timate o'tcomes or a** e"'cationa* *eve*s .primary$ secon"ary an" #i!#er e"'cation/ #ave to +e foc'se" sim'*taneo's*y. Even t#e Mi**enni'm Deve*opment -oa*s .MD-s/ of t#e Unite" Nations an" t#e Poverty Re"'ction trate!y Papers .PR P/ recommen"e" +y t#e Hor*" Ian% foc'ses primari*y 'pon t#e primary e"'cation an" !ir*s1 e"'cation ;B<. In "eve*opin! co'ntries t#e socia* ret'rns of primary e"'cation are m'c# #i!#er as compare" to t#at of tertiary e"'cation an" most of t#e time t#e re*ative*y ric# peop*e contin'e t#eir tertiary e"'cation$ e3pan"in! tertiary e"'cation is t,enty to fifty times cost*y as compare" ,it# t#e primary e"'cation e3pansion ;:<. T#erefore$ !overnments in "eve*opin! economies ,ant to re"'ce poverty in t#e c#eapest manner an" t#at1s ,#y primary e"'cation is foc'se" ;6<. T#is st'"y fin"s o't t#e effect of "ifferent *eve*s of e"'cation on poverty. In or"er to fin" o't t#is impact t#e st'"y 'se" *o!istic re!ression ,it# t#e pro+a+i*ity of +ein! poor on "ifferent *eve*s of e"'cation an" e3perience. On t#e +asis of *o,est income >'inti*es ,e constr'ct a varia+*e Jpro+a+i*ity of +ein! poorK. T#is is a "'mmy varia+*e #avin! va*'es )ero an" one. If a person is in t#e *o,est >'inti*e t#en #e=s#e is consi"ere" as poor an" #e=s#e co'*" +e assi!ne" va*'e e>'a* to one an" if person is in ot#er >'inti*es t#en #e=s#e ,i** +e consi"ere" as non(poor an" ,i** +e assi!ne" it va*'e e>'a* to )ero. T#e present st'"y 'ses t#e "ata of t#e 2IE for t#e years 4556(55 an" 7884(87 to fin" o't t#e 7

effect of e"'cation 'pon poverty. T#e st'"y is or!ani)e" in t#e fo**o,in! manner? section 7 o't*ines t#e mo"e* for empirica* estimation an" "escri+es "ata. ection @ is res'*ts an" "isc'ssion an" t#e *ast section conc*'"es t#e st'"y. 7. R&'"&W #( )"T&RAT%R& E"'cation an" #ea*t# en"o,ments of t#e in"ivi"'a*s are t#e necessary an" important components of #'man capita* ,#ic# ma%e t#em pro"'ctive an" raise t#eir stan"ar" of *ivin!. 2'man capita* is re>'ire" for t#e effective 'ti*i)ation of p#ysica* an" nat'ra* capita*s$ an" tec#no*o!y an" s%i**s. Iein! a "eve*opin! co'ntry Pa%istan #as o,ne" t#e poverty re"'ction strate!y paper$ ,#ic# is one of t#e main pi**ars of #'man capita*. Hit#o't #'man capita* form'*ation t#e !oa* of "eve*opment or poverty e*imination is inevita+*e an" #'man capita* acc'm'*ation is *ar!e*y +ase" 'pon e"'cation an" s%i**s attainment ;5<. T#e ot#er nota+*e t#in! re!ar"in! t#e e"'cation1s si!nificant ro*e in poverty re"'ction is t#e "irect *inear re*ations#ip +et,een e"'cation an" earnin!s. In Pa%istan$ it #as +een fo'n" t#at mont#*y earnin!s of an in"ivi"'a* ,or%er increase" +y :.@ percent ,it# an a""itiona* year of sc#oo*in!. Earnin!s ,i** +e increase" +y @: percent ,it# t#e attainment of ten years of sc#oo*in! a!ainst no e"'cation. Moreover$ eac# a""itiona* year of sc#oo*in! *eve* increase" earnin!s +y @ percent at primary *eve*$ +y B percent at secon"ary *eve*$ an" +y :.4 to 6.7 percent at #i!#er=tertiary *eve*. Eac# a""itiona* year of tec#nica* trainin! increase" earnin!s +y 7.B percent. T#erefore$ it is >'ite evi"ent t#at e"'cation can increase t#e earnin! potentia* of t#e poor an" t#ey +ecome pro"'ctive ;48<. T#e e"'cationa* attainment of #o'se#o*" #ea" is t#e critica* "eterminant of #o'se#o*" poverty in Pa%istan. An increase in t#e e"'cationa* *eve* of t#e #ea" of t#e #o'se#o*" si!nificant*y re"'ces t#e c#ances of t#e #o'se#o*" +ein! poor ;44<. Moreover$ an increase in t#e sc#oo*in! of #o'se#o*" #ea"s not on*y #as a positive impact on t#eir pro"'ctivity an" earnin!s +'t a*so en#ance t#e pro"'ctivity of ot#er mem+ers of t#e #o'se#o*" per#aps t#ro'!# pers'a"in! t#em to +e e"'cate" an"=or s%i**(oriente" ;47<. Not on*y poverty is concentrate" in #o'se#o*"s ,it# i**iterate=*ess e"'cate" #ea"s +'t a*so it is m'c# #armf'* for t#e fema*e(#ea"e" #o'se#o*"s as compare" to t#e ma*e( #ea"e" ones. Fema*e se!ment of o'r society is comparative*y m'c# "eprive" as compare" to ma*e one. On t#e ot#er si"e$ t#ose fema*e(#ea"e" poor #o'se#o*"s severe*y *ac% t#e +asic re>'irements of *ife. T#eir #o'sin!$ #ea*t#$ "rin%in! ,ater$ sanitation faci*ities an" !ar+a!e co**ection system a** are in "ep*ora+*e con"ition. A** t#ese t#in!s affect t#e pro"'ctivity of poor persons an" t#ey can not come o't of t#eir vicio's poverty circ*es. T#e provision of e"'cation can +rea% t#is circ*e t#ro'!# !ivin! a rise in earnin!s an" f'*fi**in! +asic nee"s ;4@<. A *ar!e portion of Pa%istan1s pop'*ation is ",e**in! in r'ra* areas #ence ,e m'st see t#e effect of e"'cation 'pon t#eir pro"'ctivity. In r'ra* areas private ret'rns to ma*e e"'cation #ave an 'p,ar" tren" "'e to #i!#er *eve*s of e"'cation in *a+or mar%ets for non(a!ric'*t'ra* ,or%. Ha!es to t#e farm(,or%ers$ ,#o #ire" for t#e 'ns%i**e"$ man'a* ,or% on t#e farm$ are not responsive to e"'cation attainment ;4D<. Ha!es an" pro"'ctivity in non(farm activities rise ,it# e"'cation at an increasin! rate as e"'cation rises. On t#e ot#er #an" t#e farm pro"'ctivity respon"s si!nificant*y on*y to t#e primary e"'cation ;4B<.

E3aminin! separate*y t#e r'ra* an" 'r+an sections of Pa%istan$ it #as +een o+serve" t#at in 'r+an areas t#e e"'cation of t#e #ea" of t#e #o'se#o*" is ne!ative*y an" "epen"ency ratio is positive*y re*ate" ,it# t#e poverty stat's of t#e #o'se#o*". In r'ra* areas asset "istri+'tion especia**y *an" an" *ivestoc% p*ay an important ro*e in "ifferin! poor an" non(poor. T#e ro*e of "omestic an" overseas transfers a*so appeare" si!nificant a!ainst poverty an" its ro*e is m'c# more effective in 'r+an areas ;4A<. E"'cationa* *eve*s .primary$ secon"ary an" tertiary/ are va*'a+*e in increasin! t#e per capita e3pen"it're of t#e #o'se#o*". As e3pen"it'res inc*'"e t#e non(foo" items #ence a!ain e"'cation is re*evant from t#e overa** ,e*fare point of vie,. F'rt#er$ e"'cationa* *eve*s are si!nificant e*ements in re"'cin! t#e c#ances of t#e #o'se#o*" to +e poor ;4:<. It ,o'*" +e ,ron! to say t#at for !ro,t#$ "eve*opment an" poverty re"'ction ,e s#o'*" ,ait for t#e 'niversa*i)in! of primary e"'cation rat#er ,e s#o'*" ,or% 'pon t#e post(primary e"'cation +eca'se it #as t#e same ro*e as primary e"'cation. Primary e"'cation is t#e initia* t#res#o*" of #'man capita* +'t secon"ary an" #i!#er e"'cation$ an" investment in science an" tec#no*o!y ,i** !ive rise to acce*eration an" s'stenance in economic !ro,t# an" "eve*opment. In In"ia t#e ana*ysis s'!!est t#at i**iteracy$ *iteracy an" primary e"'cation are positive*y re*ate" ,it# t#e poverty ratios on t#e ot#er #an" mi""*e an" secon"ary e"'cation are ne!ative*y re*ate". Moreover$ in t#e simp*e re!ression secon"ary an" #i!#er e"'cation is inverse*y re*ate" ,it# poverty$ t#erefore secon"ary an" #i!#er e"'cation is important in t#e inverse re*ation of e"'cation an" poverty apart from primary e"'cation ;B<. It #as +een seen t#at t#e *i%e*i#oo" of +ein! poor is #i!#er even for t#e *o,er *eve* of e"'cation ;46<. ometimes t#e overa** !ro,t# is more important for t#e ,e*fare of poor as compare" to t#e +asic e"'cation provision #ence income of poor raises one for one ,it# avera!e income .!ro,t#/ +'t t#e primary e"'cation attainment #as a very *imite" impact 'pon t#e income of t#e poor t#erefore t#ey came 'p ,it# t#e i"ea t#at !ro,t# is a prominent factor in e*iminatin! poverty an" primary e"'cation comp*etion is not so m'c# important. He #ave a*so s'c# e3amp*es ,#ere e"'cation can1t approve t#eir inverse re*ation ,it# poverty. T#e reasons are t#e o'tsi"e factors$ ,#ic# affects t#e inverse re*ations#ip. Eva*'ation of t#ose factors consi"erin! t#e o't#ern African co'ntries in 4558s an" in t#e +e!innin! of 7888$ s#o,e" t#at a*t#o'!# t#e e"'cationa* in"icators ,ere apprecia+*e *i%e o't of 7D t#e 47 states$ ,#ose "ata ,ere avai*a+*e$ t#e avera!e comp*etion rate of primary e"'cation ,as 6D.AC an" t#e "rop o't rate for secon"ary e"'cation ,as 4B.DC in t#e years 455:(8@. A*so t#e a"'*t *iteracy rate of t#e so't#ern African states ,as :BC in 7888 ,#ereas t#e emer!in! economies at t#at time #a" :DC an" *east "eve*opin! co'ntries #a" B7C +'t s'c# statistics !ive no consi"era+*e improvement in poverty re"'ction. Poverty remaine" sta!nate" or increase" in some cases. T#e ot#er in"icators of #'man "eprivation inc*'"in!? t#e "rin%in! ,ater$ fe,er t#an five morta*ity rates$ infants ,it# *o, +irt# rates per 4888 an" t#e preva*ence of 2IV #ave s#o,n minor pro!ress. T#e !*arin! facts 'nvei*e" t#e reasons *i%e #i!# 'nemp*oyment rates .fa** of monetary ret'rns to e"'cation/$ *imite" access to pro"'ctive reso'rces *i%e *an" an" capita*$ risin! 2IV=AID $ a+sence of s'staine" !ro,t#$ #i!# pop'*ation !ro,t# rates ,#ic# a*so "eman" more an" more #'man capita*$ *o,er >'a*ity stan"ar"s of e"'cation$ too m'c# "epen"ence 'pon t#e str'ct'ra* a"L'stment pro!rams of IMF t#at promotes re"'ction of !overnment investment 'pon socia* services an" infrastr'ct're$ pave" t#e ,ay to,ar"s "eprivation ;45<. In t#e same "irection$ t#e fai*'re of 4558s e"'cationa* e3pansion to re"'ce poverty in Gatin American co'ntries "iv'*!es D

t#e reasons ,#ic# are as fo**o,s? first*y$ t#e ine>'a*ity of e"'cationa* opport'nities$ ,#ic# res'*ts in t#e +enefit to on*y t#ose persons ,#o ,ere not so m'c# poor. econ"*y$ accor"in! to one estimate t#e eva*'ate" e"'cationa* t#res#o*" for Gatin American co'ntries is 47 years of sc#oo*in! +'t t#e !overnment on*y emp#asi)e 'pon t#e primary e"'cation. T#ir"*y$ ,it# t#e e"'cationa* e3pansion t#e !ro'p of persons ,it# #i!#er e"'cation an" #i!# earnin!s increases an" t#e e"'cationa* *eve* of t#e *ar!e *a+o'r force se!ment rises a*so +'t t#e former effect increases ine>'a*ity .t#at ca'ses poverty/ an" t#e *ater one "oes not. In 4558s t#e former effect "ramatica**y "ominates t#at is ,#y poverty persists. E"'cation "efinite*y promotes socia* co#esion ,#ic# !ives rise to t#e fa** of #'man poverty. I't if ine>'a*ity is risin! in t#e society "'e to t#e factor mentione" ear*ier t#en it ,i** !enerate socia* "ifferentiation an" "istorts t#e process of #'man poverty o+*iteration ;78<. *! $ATA AN$ M&TH$#)#+, 2o'se#o*" Income an" E3pen"it're 'rvey .2IE / is con"'cte" +y t#e Fe"era* I'rea' of tatistics .FI / t#at !ives 's t#e "etai*e" information of #o'se#o*" *eve* in Pa%istan. T#e "ata 'se" for t#is st'"y is of 4556(55 an" 7884(87. It is t#e avai*a+*e !i!antic an" meanin!f'* so'rce of information of its %in" t#at #as t#e #o'se#o*" *eve* information in Pa%istan. T#is st'"y ta%es t#e *o!istic re!ression tec#ni>'e to i"entify t#e impact of e"'cation 'pon poverty in Pa%istan. He ,i** see% o't t#e effect of "ifferent e"'cation *eve*s$ e3perience an" !en"er 'pon t#e pro+a+i*ity of +ein! poor of t#e emp*oye" in"ivi"'a*s. T#e "epen"ent varia+*e is "ic#otomo's in ,#ic# t#e va*'e 4 for t#e poor in"ivi"'a* an" 8 for t#e non(poor in"ivi"'a*. T#e very first t#in! is to e*'ci"ate t#e criteria t#ro'!# ,#ic# ,e c*assify t#e emp*oye" in"ivi"'a*s .emp*oyers$ se*f( emp*oye"$ ,a!e earners an" 'npai" fami*y ,or%ers/ into poor an" non(poor. In ot#er ,or"s$ ,e can say t#at #o, ,e assi!n va*'e of one .poor/ or )ero .non(poor/ to t#e "epen"ent "ic#otomo's varia+*e. For t#is tas%$ t#ere are "ifferent approac#es *i%e t#e +asic nee"s approac# or t#e ca*orie(+ase" approac#E +'t #ere ,e c*assify t#e in"ivi"'a*s t#ro'!# >'inti*es. He ,i** ,or% o't fo'r >'inti*es of in"ivi"'a*s "epen"in! 'pon t#eir mont#*y incomes. T#e *o,est .fo'rt#/ >'inti*e ,i** #ave t#e in"ivi"'a*s ,it# t#e *o,est mont#*y incomes. T#e in"ivi"'a*s in t#e *o,est >'inti*e ,i** +e consi"ere" poor an" conse>'ent*y "epen"ent varia+*e ,i** ta%e va*'e one for t#em ,#ereas eac# in"ivi"'a* in ot#er t#ree >'inti*es ,i** o+vio's*y ta%e t#e va*'e )ero. In e3p*anatory varia+*es$ e"'cationa* varia+*es are "'mmy varia+*es an" one of t#em ,i** !et t#e va*'e one in response to t#e in"ivi"'a*1s #i!#est e"'cationa* attainment. It means t#e e"'cationa* *eve* ,i** eit#er fa** in mi""*e$ matric'*ation$ interme"iate$ +ac#e*ors or professiona* .masters an" a+ove/ cate!ory ,#ereas 0primary e"'cation1 ,i** +e attri+'te" as reference cate!ory. Ot#er varia+*es inc*'"e e3perience .e3p/ an" !en"er. T#e e3perience varia+*e is attaine" t#ro'!# s'+tractin! t#e years of sc#oo*in! an" sc#oo* startin! a!e from t#e a!e of a person. It is not t#e act'a* +'t t#e potentia* e3perience. T#e persona* c#aracteristics inc*'"e !en"er .ma*eM4$ fema*eM8/ ,#ere fema*e ,i** +e t#e reference cate!ory. T#e res'*ts ,i** not +e interprete" t#ro'!# t#e coefficients +'t ,e ,i** 'se t#e o"" ratios in *o!istic re!ression to see t#at t#e occ'rrence of any partic'*ar event ,i** increase or "ecrease t#e pro+a+i*ity of +ein! poor an" ,it# ,#at proportion as compare" to t#e reference cate!ory. T#e o"" ratios ,ere "efine" as L'st t,o o""s t#at are compare" to B

"etermine ,#et#er one !ro'p #as #i!#er or *o,er o"" ratios of +inary o'tcome. A n'm+er$ !reater t#an one in"icates a positive association +et,een an in"epen"ent varia+*e an" t#e "epen"ent varia+*e. H#i*e a n'm+er +et,een )ero an" one in"icates a ne!ative association. -! R&S%)TS AN$ $"SC%SS"#N A *o!istic re!ression mo"e* ,as estimate" for 0pro+a+i*ity of +ein! poor1 on e3perience an" "ifferent *eve*s of e"'cation. T#e overa** res'*ts are "emonstrate" in Ta+*e 4 ,#ereas t#e separate !en"er *eve* res'*ts are "escri+e" in Ta+*e 7 an" Ta+*e @. T#e overa** res'*ts of 4556(55 an" 7884(87 .Ta+*e 4/ are s#o,in! t#at t#e o"" ratios of a** varia+*es are *ess t#an )ero t#at p'ts a** t#e e"'cationa* *eve*s$ e3perience an" !en"er in ne!ative re*ation ,it# t#e poverty stat's of t#e emp*oye" persons. T#e mi""*e$ matric'*ation .matric/$ interme"iate .inter/$ +ac#e*ors .+ac#/ an" professiona* .prof/ varia+*es are "ecreasin! t#e pro+a+i*ity of +ein! poor of emp*oye" persons +y B:.BC$ :5.:C$ 65.7C$ 5A.AC an" 55.DC respective*y as compare" to t#e reference cate!ory of 0primary e"'cation1 for t#e year 4556(55. A!ain for t#e year 7884(87 in t#e same se>'ence t#e e"'cationa* *eve*s are re"'cin! t#e *i%e*i#oo" +ein! poor of in"ivi"'a*s +y BD.6C$ :6.BC$ 66.5C$ 5:C an" 55.4C as compare" to t#e same reference cate!ory. T#e year*y comparison of t#ese e"'cationa* >'a*ifications is vivi"*y "emonstratin! t#at for *o,er *eve*s of e"'cation$ t#e ne!ative effect of e"'cation 'pon poverty remains intact +'t its intensity "ec*ines. T#e estimates of +ot# years separate*y prove" t#e fact t#at as t#e e"'cationa* attainment improves t#e proportiona* "ec*ine in t#e pro+a+i*ity of +ein! poor increases in fi!'re. Comin! to,ar"s t#e e3perience(si"e$ #ere ,e a*so see t#e ne!ative coefficient si!n an" ,it# t#e increase of one year in e3perience ,e o+serve "ec*ine of D.BC in t#e *i%e*i#oo" of +ein! poor of in"ivi"'a*s for t#e year 4556(55 an" BC for t#e year 7884(87. It is >'ite evi"ent t#at effect is minor +'t t#e improvement is t#ere. On t#e !en"er si"e$ o'r res'*t is in favor of t#e ,i"e*y preva*ent concept of !en"er +ias +eca'se +ein! a ma*e person re"'ces t#e c#ances of +ein! poor +y 5@.:C as compare" to t#e reference cate!ory of fema*e an" t#e fi!'re rises to 5D.AC in 7884(87. In t#e separate !en"er estimates in Ta+*e 7 an" Ta+*e @$ ,e e3p*ore t#e patterns ,#ic# are in *ine ,it# t#e overa** interprete" res'*ts e3p*aine" a+ove. For +ot# ma*e an" fema*e re!ressions$ ,e see t#at e3perience an" a** e"'cationa* *eve*s are ne!ative*y re*ate" ,it# t#e poverty stat's of t#e emp*oye" persons. Moreover$ as t#e ac>'isition of e"'cation increases t#e proportiona* "ec*ine in t#e pro+a+i*ity of +ein! poor consistent*y increases. 2o,ever$ t#e e3perience of ma*e persons appears increasin!*y m'c# +eneficia* in 7884( 87 as compare" ,it# 4556(55 as t#e proportiona* fi!'re !oes from D.:C to B.AC +'t ,e "o not o+serve s'c# increasin! tren" for t#e fema*es. In Ta+*e 7 .Ma*e/$ ,e see t#at +ac#e*ors *eve* s#o,n improvement as t#e proportiona* "ec*ine in pro+a+i*ity of +ein! poor !oes from 5BC to 5A.4C ,#ereas mi""*e$ interme"iate$ professiona* !ive "o,n,ar" tren" an" t#e effect of matric'*ation is same for t#e t,o years. In ta+*e @ .fema*e/$ more or *ess a** e"'cationa* *eve*s "o not ame*iorate. -enera**y$ t#e res'*ts "epict t#at t#ere ,as a ne!ative re*ations#ip +et,een pro+a+i*ity of +ein! poor an" "ifferent *eve* of e"'cation. It means t#at #i!#er *eve*s of e"'cation re"'ce t#e pro+a+i*ity of +ein! poor

!ra"'a**y. 2ence e"'cation *eve* #as an important stan"in! in re"'cin! poverty in t#e co'ntry. .! C#NC)%S"#N T#is st'"y is "one to estimate t#e effect of e"'cation 'pon poverty in Pa%istan. T#e "ata 'se" for t#is tas% is ta%en from t#e 2o'se#o*" Inte!rate" Economic 'rvey .2IE 4556(55 an" 2IE 7884(87/ con"'cte" +y t#e Fe"era* I'rea' of tatistics. T#e res'*ts of t#e *o!istic re!ression are in accor"ance ,it# t#e !enera**y accepte" t#eory t#at e"'cationa* attainment is a critica* "eterminant of t#e inci"ence of poverty an" s#o'*" +e consi"ere" primari*y in imp*ementin! poverty a**eviation pro!rammes. T#e res'*ts #ave s#o,n t#at e"'cation attainment #as a ne!ative impact 'pon poverty. T#e ot#er nota+*e t#in! is t#e consistent increase in t#e c#ances of escapin! poverty of a person as ,e increase t#e e"'cationa* *eve* it means t#at as e"'cationa* ac#ievement increases$ t#e *i%e*i#oo" of a person to +e poor "ec*ines. T#erefore$ e"'cation is t#e most important factor re!ar"in! poverty re"'ction. T#e attainment of e"'cation en#ances t#e earnin! potentia* of in"ivi"'a*s an" conse>'ent*y$ t#e increase" earnin!s ,i** "efinite*y #e*p t#em to +e o't of poverty. E"'cation is ne!ative*y *in%e" ,it# t#e poverty stat's an" #i!#er *eve*s of e"'cation ,i** +e more an" more effective in poverty re"'ction. E3perience #as a*so a ne!ative re*ation ,it# t#e poverty stat's +eca'se o+vio's*y as t#e e3perience !ro,s a person1s e3pertise in partic'*ar fie*" en#ances ,#ic# provi"es #im an opport'nity to earn #i!#er. It can +e ta%en as t#e improvement in e3pertise an" s%i** en#ancement$ ,#ic# #ave positive imp*ications in case of poverty e*imination. T#e 0femini)ation of poverty1 means ,omen are m'c# more "eprive" an" facin! severe #ar"s#ips in p'**in! t#emse*ves o't of poverty as compare" to men "'e to t#eir 'ne>'a* e"'cationa* an" emp*oyment opport'nities. T#e c'rrent st'"y conc*'"es t#at a ma*e person re"'ces t#e ris% of poverty as compare" to t#e fema*e an" t#e separate fema*e res'*ts "o not !ive 's an impressive sit'ation t#erefore t#ere is a nee" to ta%e an evasive action to provi"e a con!enia* emp*oyment environment for t#e fema*e a*on! ,it# e>'a* e"'cationa* opport'nities +eca'se t#ey are a*most #a*f se!ment of o'r society an" t#eir ,e** +ein! ,i** "efinite*y #e*p 's in era"icatin! poverty.

R&(&R&NC&S 4. Hor*" Ian% .455@/ JT#e East Asian Mirac*e? Economic -ro,t# an" P'+*ic Po*icyK$ Po*icy Researc# Report$ O3for" University Press. 7. Neffery$ R. an" Ias'$ M.A. .455A/. -ir*sO c#oo*in!$ HomenOs A'tonomy an" Ferti*ity C#an!e in o't# Asia. Ne, De*#i? a!e P'+*ications. @. Iram*ey$-. an" 9ar*ey$ 9.N. .788B/. 2ome(O,ners#ip$ Poverty an" E"'cationa* Ac#ievement? In"ivi"'a*$ c#oo* an" Nei!#+o'r#oo" Effects. CR I Researc# Report$ ,,,.crsis.#,.ac.'%. D. UNE CO .788:/ JE"'cation For A** -*o+a* Monitorin! Report 788:K$ www.unesco.org. B. Ti*a%$ N.I.-. .788B/. Post E*ementary E"'cation$ Poverty an" Deve*opment in In"ia. Internationa* No'rna* of E"'cationa* Deve*opment, 7:$D@B(DDB. A. UNE CO(PROAP .4556/ JIasic E"'cation for Empo,erment of t#e PoorK Ian!%o%. :. Co*c*o'!#$ C. A*( amarrai .$ Rose$ P. an" Tem+on. M. .788@/. Ac#ievin! c#oo*in! for a** in Africa? Costs$ Commitment an" -en"er. A*"ers#ot ? As#!ate Press. 6. Co*c*o'!#$ C. .788B/. Does E"'cation A+roa" 2e*p to A**eviate Poverty at 2omeP An Assessment. T#e Pa%istan Deve*opment Revie,$ DD$D@5(DBD. 5. M'!#a*$H.2. .788:/. 2'man Capita* Investment an" Poverty Re"'ction trate!y in Pa%istan. Ga+o'r an" Mana!ement in Deve*opment$ :$A4(::. 48. Nasir$ Q. M. an" Na)*i$ 2. .7888/. E"'cation an" Earnin!s in Pa%istan. Researc# Report No. 4::. Pa%istan Instit'te of Deve*opment Economics .PIDE/. 44. &'res#i$ .9. an" Arif$ -.M. .7884/. Profi*e of Poverty in Pa%istan 4556(55. MIMAP Tec#nica* Paper eries No. B. Pa%istan Instit'te of Deve*opment Economics$ Is*ama+a". 47. A+'%a$ C.A.$ E!o$ M.A.$ Opo*ot$ N. an" O%e**o$ P. .788:/. Determinants of Poverty V'*nera+i*ity in U!an"a$ Disc'ssion Paper No. 78@. Instit'te for Internationa* Inte!ration t'"ies. 4@. 2a>$ R. .788B/. An Ana*ysis of Poverty at t#e Goca* Geve*. T#e Pa%istan Deve*opment Revie,, DD$485@(4485. 4D. 9'rosa%i$ T. .7884/. Effects of E"'cation on Farm an" Non(Farm Pro"'ctivity in R'ra* Pa%istan. Disc'ssion Paper No. 7884(887$ Fo'n"ation for A"vance" t'"ies on Internationa* Deve*opment .FA ID/. 4B. 9'rosa%i$ T. an" 9#an$ 2. .788A/. 2'man Capita*$ Pro"'ctivity$ an" tratification in R'ra* Pa%istan. Revie, of Deve*opment Economics$ 48$44A(4@D. 6

4A. Nama*$ 2. .788B/. In earc# of Poverty Pre"ictors? T#e Case of Ur+an an" R'ra* Pa%istan. T#e Pa%istan Deve*opment Revie,$ DD$@:(BB. 4:. O%oLie$ C.E.E. .7887/. -en"er an" E"'cation as Determinants of 2o'se#o*" Poverty in Ni!eria. Disc'ssion Paper No. 7887=@:. Hor*" Instit'te for Deve*opment Economics Researc# .HIDER/. 46. Ro"ri!'e)$ A.-. an" mit#$ .M. .455D/. A Comparison of Determinants of Ur+an$ R'ra* an" Farm Poverty in Costa Rica. Hor*" Deve*opment$ 77$@64(5:. 45. enia$ N. an" -o",e**$ N. .788A/. Macroeconomics$ .A"'*t/ E"'cation$ an" Poverty Era"ication in o't#ern Africa. Revie, of E"'cation, B7$@8B(@77. 78. Iona*$ R. .788:/. On -*o+a* A+sences? Ref*ections on t#e Fai*in!s in t#e E"'cation an" Poverty Re*ations#ip in Gatin American Co'ntries. Internationa* No'rna* of E"'cationa* Deve*opment$ 7:$6A(488.

A//&N$"0 Ta+*e 4? Go!istic Re!ression Mo"e* of +ein! poor ,it# m'*tip*e in"epen"ent varia+*es .overa**/. Varia+*es e3p mi""*e matric inter +ac# prof ma*e Constant S 4556(55 O""(Ratios 8.5BB 8.D7B 8.78@ 8.486 8.8@D 8.88A 8.8A@ D:.:DA S (8.8B4 (8.:5D (4.B@B (7.788 (@.B8B (D.A55 (7.57@ 7.546 7884(87 O""(Ratios 8.5B8 8.DB7 8.74B 8.444 8.8@8 8.885 8.8BD 46.B85

(8.8D: (8.6BA (4.B5A (7.77B (@.@68 (B.44A (7.::4 @.6AA

S A** coefficients appeare" si!nificant in t#e Ha*" test. Depen"ent varia+*e? pro+a+i*ity of +ein! poor

Ta+*e 7? Go!istic Re!ression Mo"e* of +ein! poor ,it# m'*tip*e in"epen"ent varia+*es .Ma*e/. Varia+*es e3p mi""*e matric inter +ac# prof 4556(55 S (8.8D5 (8.6D6 (4.D:6 (4.5:D (7.55: (D.76@ O""( Ratios 8.5B@ 8.D76 8.776 8.4@5 8.8B8 8.84D 7884(87 S (8.8B6 (8.64B (4.D:6 (4.5DA (@.7@7 (@.6:8 O""(Ratios 8.5DD 8.DD@ 8.776 8.4D@ 8.8@5 8.874 48

Constant

4.44:

@.8BB

8.4@7

4.4D4

SA** coefficients appeare" si!nificant in t#e Ha*" test. Depen"ent varia+*e? pro+a+i*ity of +ein! poor

Ta+*e @? Go!istic Re!ression Mo"e* of +ein! poor ,it# m'*tip*e in"epen"ent varia+*es .Fema*e/. Varia+*es e3p mi""*e matric inter +ac# prof Constant 4556(55 S (8.8@6 (4.8@A (@.@@: (@.646 (D.B8A (A.@85 D.7B4 O""(Ratios 8.5A@ 8.@BB 8.8@A 8.877 8.844 8.887 :8.4AA 7884(87 S (8.8@4 (8.647 (4.:A5 (7.DB5 (@.@7@ (D.576 7.@B7 O""(Ratios 8.5:8 8.DDD 8.4:4 8.86A 8.8@A 8.88: 48.B86

SA** coefficients appeare" si!nificant in t#e Ha*" test. Depen"ent varia+*e? pro+a+i*ity of +ein! poor

44