Title

Political economy of resources distribution: Theory and evidence from Balochistan, Pakistan

Abstract/Description

The paper aims to critically evaluate the political economy of resources (public sector budgetary resources) distribution in Balochistan province, Pakistan. The paper examines the overarching influence of “elite capture” – the influences of the chief minister, the cabinet members of provincial government, and senior bureaucrats – in resources distribution during the period of fiscal years 2008-09 to 2018-19. The study applies plausible theory and strong evidence from Balochistan province. From empirical investigation a balanced panel approach shall be applied using district level data. The preliminary results suggest a strong elite capture and biased interventions in the process of budget making and the allocations of resources/projects to districts, as incumbent politicians and senior career officials at the helm of affairs make disproportionate budgetary allocations of public resources to their home districts or constituencies. The evidence further suggests that districts, which are represented neither in political nor senior officials’ incumbency, receive far lesser budgetary allocations than their proportionate share despite prevailing poor social and economic indicators. Such an “unbalanced” and politically motivated resources allocation is bound to create an inter-regions and inter-districts disparity in terms of economic and social development within the province.

Session Theme

Governance, Finance and Fiscal Policy - Session IC

Session Type

Parallel Technical Session

Session Chair

Dr. Sana Tauseef, Chairperson, Department of Finance, Institute of Business Administration, Karachi

Session Discussant

Dr. Hilal Butt, Associate Professor, Institute of Business Administration, Karachi

Start Date

2-4-2021 2:30 PM

End Date

2-4-2021 4:00 PM

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Apr 2nd, 2:30 PM Apr 2nd, 4:00 PM

Political economy of resources distribution: Theory and evidence from Balochistan, Pakistan

The paper aims to critically evaluate the political economy of resources (public sector budgetary resources) distribution in Balochistan province, Pakistan. The paper examines the overarching influence of “elite capture” – the influences of the chief minister, the cabinet members of provincial government, and senior bureaucrats – in resources distribution during the period of fiscal years 2008-09 to 2018-19. The study applies plausible theory and strong evidence from Balochistan province. From empirical investigation a balanced panel approach shall be applied using district level data. The preliminary results suggest a strong elite capture and biased interventions in the process of budget making and the allocations of resources/projects to districts, as incumbent politicians and senior career officials at the helm of affairs make disproportionate budgetary allocations of public resources to their home districts or constituencies. The evidence further suggests that districts, which are represented neither in political nor senior officials’ incumbency, receive far lesser budgetary allocations than their proportionate share despite prevailing poor social and economic indicators. Such an “unbalanced” and politically motivated resources allocation is bound to create an inter-regions and inter-districts disparity in terms of economic and social development within the province.