PROJECT ON
URBAN POVERTY IN (City name)
ACKNOWLEDGEMENT
All acclamation and appreciation are for “All Mighty ALLAH” who bestowed the mankind with knowledge and wisdom and granted him vicegerency on earth and all the respect for his Prophet Muhammad (P.B.U.H) for enlightening with the essence of faith in ALLAH and guiding the mankind to the true path of life.
It is a matter of honour for me to express my gratitude and appreciation for my honorable supervisor Mr. ABC, chairman department of economics, government postgraduate college Nowshera. His content guidance and supervision has kept me on track and enabled to successfully complete my thesis.
I also wish to express my gratitude to the whole teaching staff of economics department, government postgraduate College Nowshera, for their kind and friendly cooperation.
I am also greatly indebted to my parents, sisters and my special thanks to my sister ABC for their love and affections which hearten me to achieve success in each and every sphere of life, without their encouragement and moral support the present study would have been a dream.
I am thankful to all my friends and class fellows for their cooperation and encouragement I would like to express my deep sense of gratitude and heartfelt thanks to my sincere friend XYZ. If I was able to complete my thesis then it was because of my friends help.
ABSTRACT
This paper seeks to identify the determinants of Urban poverty in Nowshera , a district of Khyber Pakhtunkhwa . The study is based on cross sectional data collected through fields survey. A total of 60 households were selected. The results shows that education of the households head , family size , nature of occupation and provision of public services play important role in poverty alleviation. Incidence of poverty is highest among the daily wage workers and lowest among the government employees. The result also shows that education of the households and provision of public services are negatively related with the poverty status of the household while greater household size and female dominated households are positively related with the poverty status of the household. So it is suggested that investing more in provision of education, population planning programs , health services and jobs opportunities by government is thus key to an increase on overall income of the population and hence to reduce the poverty level.
CHAPTER 1
INTRODUCTION
Etymology : The word "poverty" and "poor" came from Latin pauper = "poor" which originally came from Pau- and root of Pario, i.e, "giving birth to not much" and referred to unproductive farmland or livestock.
The phenomenon of poverty can be defined as the lack of basic human needs such as water, nutrition, health care, education ,clothing and shelter accompanied by a range of other social indicators such as life expectancy ,infant mortality, proportion of the budget spending on necessities, enrolment rate and a common index of welfare. It is estimated that out of the world 6.2 billion peoples live on less than 2 dollor a day and 1.2 billion peoples on less than a dollar one day which is very low income to meet even the basic necessities of life.
The analysis of urban poverty is as necessary as the overall level of poverty in the country. Urban poverty is distinct from the rural poverty with respect to its incidence, economic demographic and political aspects.
.In developed countries rural areas are also equipped and facilitated with basic life needs like gas, water, electricity, job opportunities etc, therefore the migration of population from rural areas to urban areas is less, while in 3rd world countries like Pakistan population in rural areas is deprived of basic needs and therefore migration from rural to urban areas is more frequent. One of the reason cited for urban poverty is that people shifting from rural areas are mostly less educated or illiterate and when they migrate to urban areas they could not acquire jobs etc and hence live a miserable life and causing urban poverty. Many reasons like inflation, high rates and high utility bills also contribute towards urban poverty. It is also observed that poor try to urbanize faster as compared o the whole population and this urbanization process leads toward the emergence of urban poverty it is estimated that the urban population of Pakistan is 35 % of the total population and its annual average growth rate is 3.4 % (1990-2005)
In Pakistan the phenomenon of poverty in moving like a business cycle. It was high in 1960s and came down in 1980s but again moved upward in 1990s before falling rapidly after 2000.
Urban poverty fell from 22.7% in 2000-01 to 13.1% in 2005-06. This rapid fall of urban poverty is linked with strong economic growth, rise in per capita income large inflow of remittances and better economic and social policies of last government.
Recently high inflation eroded the gain made in poverty reduction by pushing people close or below the poverty line. High inflation, global financial crises and recession in domestic economy cause positive shifts in poverty measures.
As we observe the dimension and movement of poverty at different time periods, but these explain the poverty in a limited way. This information does not give any details of the causes of poverty and we are not able to answer the following question that Is poverty high due to low education or large family size or due to any other reason?
Given the changing level of poverty and emergence of new forms of urban poverty. It is necessary to examine urban poverty at city level that will provide the information about who is poor, where they live in the city, their access to services, their living standard and so for. The sample city, chosen in this study to analyze the urban poverty and its determination in Nowshera. Nowshera is a district in the Khyber Pakhunkhwa province of Pakistan. Nowshera district is divided into 47 union councils with 2 national and 5 provincial assembly seats according to the 1998 census of Pakistan. The population was 0.87 million, population density of 500.2 persons per square km. the annual growth rate was 2.9 % and the proportion of urban dwellers was 26 %. The literacy rate is 89%. Nowshera is small industrial estate e.g match, beverages and marble industries in Risalpur, paper mill in Amangarh, Pakistan, tobacco company (PTC) in Akora Khattak which is the largest source of income. Some other small industries like textile, medicine, Shama Ghee Mill, Small Oil Refinery, Sheet Glass. The main source of income of the region is agriculture. The major crops of this area are wheats, maize, vegetables, sugarcane and citrus. But most of people are engaged with Govt. services.
• Objectivities Of The Study
The objectivities of the study are:
• To determine the determinants of urban poverty in the study area.
• To suggest possible measures to address this issue.
• The Main Relationships Tested In This Study Are As Follows
• Education is negatively related to urban poverty
• Provisions of public services are negatively related with status of the poor
• Large family size has positive impact on urban poverty
• Incidence of poverty is highest among the daily wage worker
• Organization Of Study
This study is organized into 5 Chapters. In Chapter 1, introduction is given. Chapter 2 provides literature review. In Chapter 3, research methodology is discussed. In Chapter 4 descriptive analysis of data are given. Chapter 5, gives the important findings of this study and provides some policy recommendations
CHAPTER 2
LITERATURE REVIEW
Aims, Philip (1995) studied the relationship between urban poverty and the labor market. A number of distinctive features of urban poverty are discussed including the informal labor market, female headed household the individualized nature of urban poverty and the greater exposure of urban residents to environment risks.
Arif and Iqbal (2009) analyzed infrastructure and poverty in Pakistan. They found that access to electricity and provision of education facilities for girls and hearth facilities in the public sector play an important role in explaining the difference in poverty levels. Investing more in provision of education and health services is thus key to an increase in overall income of the population and hence to reduce the poverty.
Awan et al (2010) studied the determinants of urban poverty in Sargodha. The analysis is based on the survey of 330 household. Empirical findings show that employment in public sector, investment in human capital an access to public amenities reduce poverty, while employment in informal sector greater household size and female dominated household increase poverty .
Awan, M.S et al (2011) had studied the impact of human capital on urban poverty in Sargodha city. Results shows that education and experience is negatively related with the poverty status of individuals and also sustains even in separate gender. This implies education of poor is necessary in breaking the vicious circle of poverty.
Bake, J and Lall,s (2008) examined urban poverty a global view in Latin America. Empirical finding in this paper provides an overview on what has been leaned about urban poverty ovary the past decade with a focus on what is new and what the implications are for the world bank going forward in an increasingly urbanized world. This paper identifies priorities for urban poverty reduction within the context of an overall urban strategy.
I.S Chaudhry (2009) examined poverty Alleviation in southern Punjab. The findings indicate that education of household head is the main determinant of household poverty and the literate head of household reduces the provability of being poor .
Jamal, H.(2005) showed that in urban areas dependency ratio is also positively related with the poverty status of the household and also concludes that in urban areas the education of the head of the household is negatively related with poverty.
Manda, K.D et al (2003) had studied urban poverty and labor force participation in Kenya. The study conclude that the poor section of the urban population can be divided into the “working poor” category and “unemployed poor” category where as the informal sector is dominated by the working poor category but at the same time the destitution of unemployed cannot be ignored.
M.A Siddiqui (2009) had studied the determinants of poverty in Pakistan. This study is carried out with the help of logit and probit and extreme value (Gompit) Models. And explore a number of factors leading towards poverty alleviation in Pakistan, like education, sex, different age caterfors, different occupations and many other socio- economic indicators.
Mckay, A and D. Lawson (2002) studied chronic poverty. The empirical finding of his study show that large family size is likely to put extra burden on a household’s assets and resource
Qureshi, S.K et al.(2001) studied the profile of poverty in Pakistan 1998-99 poverty differentials across rural/urban areas, farm status of the household and other socio-economic groups were also examined, logistic regression model have been used for estimation. The result of this study supports the view that the recent rise in poverty which started in the early 1990, contributed at eh end of decade. More reual household were poor than urban household.
Suddique (2001) analyzed gender dimensions of poverty in Pakistan. The study concludes that improvement in human capital formation can be important in increasing women’s economic involvement and a reduction in gender based poverty.
Tayyab and Muhammd (1998) in his theses report realized that south Asian is the most deprived and the poorest region in the world where population rate is high and this region is poor interms of education, health, food and nutrition, health of children and women income level and military burden
UN (2005) examined that natural population growth rural to urban migration and the reclassification of rural to urban areas works as deeper determinations of urban poverty. It is estimated that rural to urban migration and reclassification of areas are responsible of 40 to 50 % of urban population growth.
Usman Mubashir (2009) studied the socio- economic determinants of poverty in Pakistan. The empirical findings show that gender disparities, inequality, spatial dimensions, political instability, weak institutions and lack of spiritual capital causes the pover, the holistic development took place when people will be empowered politically, casually and economically.
CHAPTER 3
RESEARCY METHODOLOGY
In this chapter the research methodology adopted for the present study is discussed.
3.1 Universe of The Study
The research was conducted as a case study of Nowshera. This is a famous District of Khyber Pakhunkhwa. According to 1998 census of Pakistan. The population was 0.87 Million. The annual growth rate was 2.9 % and the proportion of urban dwellers was 26 % the literacy rate is 89 %.It lies at bank of River Kabul. Nowshera consists of two parts Nowshera cantt and Nowshera kallan. A very famous army artillery officer’s school is in Nowshera.
3.2 Data Source
The data used in this study was primary data collected through simple random sampling technique. For collection of data the interview were conducted in selected streets’, from 60 household.
3.3 Sample Size
Sample size consisted of 60 household
3.4 Data Collection Tool
A special questionnaire was designed and used for data collection.
3.5 Analytical Technique Used For Data Analysis
After data collection the percentage method is adopted for obtaining the empirical results from the data.
CHAPTER 4
DISCRIPTIVE ANALYSIS OF DATA
In this chapter a detailed descriptive analysis of data is given. Concentrated on the sample of 60 households
A brief description analysis of the variables which affects urban poverty is given as under
4.1 Age Groups
| Age in years | Frequency | %age |
| 0-4 | 33 | 9 |
| 5-17 | 108 | 29.9 |
| 18-59 | 182 | 50.4 |
| 60 and above | 38 | 10 |
| Total | 361 | 100 |
Source: field Survey
The above table shows that 9% were infant, 29.9 were children, 50.4 were adults and 10% were aged people in the study area most of the population is in the age of adults.
4.2 Sex Composition
| Sex | Frequency | %age |
| Male | 199 | 55.12% |
| Female | 162 | 44.8% |
| Total | 361 | 100 |
Source: field Survey
In the study area males are 55.12 % and females are 44.8% out of 100%
4.3 Head of the Household
| Sex | Frequency | %age |
| Male | 57 | 95 |
| Female | 3 | 5 |
| Total | 60 | 100 |
Source: field survey
In the study area out of 60 sample. 95 % of the household head were male while only 5% were female. We observe that the lowest income of the female were below 5,000 and highest income were 10,000 while the lowest income of the male household head were 10,000 and highest income were 65,000.So higher incidence of poverty is found among female household head
4.4 Marital Status
| Marital Status | Frequency | % age |
| Married | 140 | 42.7 |
| Unmarried | 188 | 57.7 |
| Total | 328 | 100 |
Source: Field Survey
Under marital status two categories are made i.e married and unmarried. In our sample 42.7% were married and 57.7% were unmarried
4.5 House Hold Size
| Size | Frequency | %age |
| Below 4 | 13 | 21.7 |
| 5-8 | 44 | 73.3 |
| 9-12 | 3 | 5 |
| Total | 60 | 100 |
Source: Field Survey
The above table shows that 73.3% of the respondent have the household size from 5-8, 21.7 % have below 5 and 5 % have the household size from 9-12.
4.6 Origin Of The Family
| Origin | Frequency | %age |
| Local | 28 | 46.7 |
| Migrated | 32 | 53.3 |
| Total | 60 | 100 |
Source: field Survey
The above table shows that in the study area 53.3% respondent were migrated and 46.7 % respondent were local
4.7 Total Family Income
| Income (Rupees) | Frequency | %age |
| 15,000 & less | 23 | 38.3 |
| 16,000-30,000 | 22 | 36.6 |
| 31,000-45,000 | 11 | 18.3 |
| 46,000 & Above | 4 | 6.7 |
| Total | 60 | 100 |
Source: field Survey
Total income of household is divided into four categories. 38.3 % of the respondents were in the lower income category i.e 15000 and less, 36.6% were in the income category of 16000-30000, 18.3 % were in the category of 31000-45000, 6.7 % were in the category of46000 and above. So it is concluded that incidence of poverty is highest among lower income group
4.8 Most Expensive Items
| Items | Frequency | %age |
| Rent | 20 | 7 |
| Utility Bills | 80 | 26.2 |
| Food | 110 | 36 |
| Education | 60 | 20 |
| Health | 30 | 9 |
| Other | 5 | 1.6 |
| Total | 305 | 100 |
Source : Field Survey
In the study area the most expensive item is food ( 36%), utility bill was in second number (26.2%), while education was in third number (20%)
4.9 Education Status Of The Household:
| Education Status | Frequency | %age |
| Illiterate | 51 | 16.35 |
| Primary | 87 | 28 |
| Matric | 81 | 26 |
| F.A | 46 | 14.7 |
| B.A | 28 | 9 |
| M.A | 19 | 6 |
| Total | 312 | 100 |
Source : field Survey
The following table shows that in the study area most of the respondent were educated 6 % of the respondent were educated up to master level,9% were graduates, 14.7% were educated upto secondary level, 26% of the respondents were educated upto matric,28%were educated upto primary level and 51% of the respondent were illiterate. The overall result shows that majority of respondents were educated.
4.10 Employment status:
| Respondents | Frequency | %age |
| Employed | 71 | 32.3 |
| unemployed | 149 | 67.7 |
| Total | 220 | 100 |
Source : field Survey
The above table shows that in the study area most of the respondents were unemployed i.e 67.7% due to some constraints, and 32.3% were employed.
4.11 Reasons For Unemployment
| Reasons | Frequency | %age |
| Lack of Education | 35 | 23.5 |
| Disable | 39 | 26.2 |
| Lack of job opportunity | 75 | 50.3 |
| Total | 149 | 100 |
Source : field Survey
In our sample 149 respondents were unemployed. The reasons for unemployment are different.
The major reason is the lack of job opportunity 50.3% of the respondent are in search of job but found no job for them.23.5 % of the respondent were unemployed because they have no sufficient education for job.26.2% of the respondent were disable.
4.12 Occupation Status
| Occupation Status | Frequency | %age |
| Labor | 14 | 20 |
| Govt Job | 28 | 39.4 |
| Private Job | 20 | 28.2 |
| own business | 9 | 12.6 |
| Total | 71 | 100 |
Source : field Survey
The occupation status shows that 39.4% of total respondents are employed in government category. In this category people employed in government department/institutions and semi-government institutions are included, and 28.2% are working in private corporate sector,12.6% having their own business. The workers who are getting salaries on daily wages are 20%.
4.13 Number Of Earners In A Family
| # of Earners | Frequency | %age |
| 0-1 | 42 | 70 |
| 2-3 | 17 | 28.3 |
| 4-5 | 1 | 1.6 |
| Total | 60 | 100 |
Source : field Survey
The following table shows that the number of earners in a family. The table shows that majority 70% were had (0-1) earning member in a family, 28.3% were had (2-3) earning members in a family and only 1.6 % were had 4-5 earning members in a family
4.14 Number Of Dependent Member
| # of Dependant Members | Frequency | %age |
| 1-3 | 13 | 21.7 |
| 4-6 | 42 | 70 |
| 7-9 | 5 | 8.3 |
| Total | 60 | 100 |
Source : field Survey
In the study area 70% of the respondent had dependent members in the range of 4-6,21.7% were had in the range of 1-3 and 8.3 % had dependent members in the range of 7-9
4.15 Tenancy Arrangement of Houses
| Respondents | Frequency | %age |
| Own House | 26 | 43.3 |
| Rented House | 34 | 56.7 |
| Total | 60 | 100 |
Source : field Survey
The table shows that majority of the respondent live in rented houses i.e 56.7 % that are mostly migrated. While 43.3% have their own houses. And most of them are local.
4.16 Female Participation Rate
| Participation | Frequency | %age |
| Yes | 23 | 14.2 |
| No | 139 | 85.8 |
| Total | 162 | 100 |
Source : field Survey
The above table shows that 85.8 % of the females are dominated house hold and does not participate in earnings activity, while 14.2% were participate.
4.17 Access To Basic Facilities
| Facility | Yes | %age | No | %age | Total |
| Education | 37 | 61.7 | 23 | 38.3 | 60 |
| Health | 20 | 33.3 | 40 | 66.7 | 60 |
| Drainage System | 46 | 76.7 | 14 | 23.3 | 60 |
| Sanitation | 50 | 83.7 | 10 | 16.7 | 60 |
Source : Field Survey
Explanation:
The above table Shows that in the study area majority of the respondent provided education facility 61.7% out of 60 sample, and majority of the respondent (66.7%) claim that they were not provided the health facility. And mostly respondent (76.7%) were provided the drainage system, and also mostly respondent (83.3%) were satisfied from sanitation facility.
4. 18 Causes of Poverty
| Causes of Poverty | Frequency | %age |
| Lack of Education | 16 | 26.7 |
| Lack of Jobs | 28 | 46.6 |
| High Prices | 12 | 20 |
| Others | 4 | 6.7 |
| Total | 60 | 100 |
Source : Field Survey
The above table shows that in that study area out of 100% , 26.7 % of the respondents said that poverty is due to lack of education. 46.6% said that poverty is due to lack of Jobs, 20% said that poverty is due to high prices while 6.7 % said that poverty is due to many other reasons.
CHAPTER 5
FINDINGS AND RECOMMENDATIONS
5.1 Finding
This study has been analyzed the determinants of urban poverty. The analysis is conducted as a case study of Nowshera. Nowshera is to be considered the most populated city and also facing the problem of urbanization. The situation is becoming worse now. The main findings of this study are as under.
1. Analysis indicate that in the study area majority of the respondents have low per capita income and living below poverty line. The monthly income of the respondents of the area was very low as compared to their expenses. Most of the respondent having income level less than 15000, i.e 38.3%, 35% were having income from 16000-3000, 18.3 % were having income from 31000-45000, 6.7 were having income from 46000 and above.
2. The age of the household is divided into 4 categories. Analysis indicated that poverty level reduces with the increase of age of the head of the household. Lowest incidence of poverty is found among the age group of 60 and above. These household probably had some assets, more experience and relatively more earners, so less poverty in the household.
3. Higher incidence of poverty were found among female headed household. The data shows that the lowest income of the female household head were below 5,000 and highest income were 10,000 while the lowest income of the male household will be more in female household head.
4. Family size is important because with increase in family size the burden upon the pool of resources of any family will increase, and practically we have lesser and lesser resources for the welfare of individuals. Large families are more prone to poverty.
5. Prevision of public services are negatively related with status of the poor.
6. Education is an important component of human capital and it is very much effective in poverty reeducation. Education is negatively related to poverty status.
7. It was found that in the study area out of 60 sample 149 of the respondents were unemployed due to some constraints. i.e(lack of education, unskilled, disabled, lack of job opportunity)
8. Results shows that incidence of poverty is highest among the daily wage worker and lowest among the government employees. this indicates that secure job and proper flow of income has direct implication for poverty status.
9. It was found that people are more secure in government sector, so they are less poor, while people working on daily basis are not secure with their earnings. People with secure job have more capacity to absorb economic shocks
10. Another important findings is that poverty in these household works in public sector is negligible, this indicate that public sector is more reliable sector through which poverty can be reduces
11. In the study area only 12.6% of the respondents have their own business which shows that business cycle is very down.
12. It was found that in the study area female participation rate is low and most of the female were household dominated.
13. In the study area respondent spend their income mostly on food i.e. 36% and second item is utility bills, which is 26% and third is education that is 19.8% there are many other answers that were given by the respondents.
14. Analysis indicate that poor women are working in the houses of well to do people but hey are not receiving adequate income.
15. Most of the local respondents have their own houses, i.e. 43.3% and the migrated people have houses on rent i.e. 56.7%
16. In the study area the health condition is also very worse. Nowshera is highly populated city and its most people are poor and they rely on two big hospitals for seeking treatment and they were not satisfied with them. On the other hand they have no finances to go for treatment to private clinics our results are consistent with the previous studies as discussed in the literature review.
17. According to their personal observations of the study area every respondent told about their own problem and give different reasons of poverty. 26.7% of the respondent give the reason that cause of poverty is due to “ Lack of Education”, 28% of the respondents said about the “ Lack of Jobs”, 20 % give the reason that poverty is due to the “High Prices”, and 6.7% respondent give many other reasons
5.2 Recommendations
In order to improve the conditions of the respondents of Nowshera, the following recommendations are given in the light of above findings and the views of the respondents.
• There is need to focus on the education of the poor because human capital plays vital role in breaking the vicious circle of poverty. Public sector and private sector along with community participation should manage and create human capital in the shape of better technical education.
• Steps should be taken by government to minimize the wage differentials between public and private sector by increasing minimum wage to reduce poverty
• Population planning can play an effective role in controlling the rapid growth of population but the government must run population planning programme more effectively.
• Government should provide vocational braining and technical education to illiterate persons in order to provide job opportunities.
• Poverty increases in the area where people are jobless. So several employment scheme should be introduced to general employment for unskilled and skilled people.
• In the study area the people are relying on two basic big hospitals i.e (CMH Nowshera and Nowshera Govt Hospital). Nowshera is a big populated city and these two hospitals cannot fulfill their health need, so the government should open more dispensaries and clinics and promote trained and qualified doctors in the study area and the medicine should be provided free of cost to the poor.
• The government should give the loan to the skilled women to start small enterprise at home to reduce poverty.
• Almost half of the population consists of female but due to social and cultural constraints, they are unable to participate actively to improve their living condition to achieve sustainable development. So more emphasis should be five to female community organization and gender development
• Zakat is a good way to help poor, but many orphans and widows are not getting zakat. Zakat committees are contributing zakat to their own people
• The political awareness must be enhance in the people and they must not select people on family back ground, but select on education, maturity that after selection he work not only for himself but for the whole community
• With growing population, it is crucial to think about growing need of housing and urban services. These challenges of urbanization needs to be addressed through proper planning and management and not through any mechanism to control urbanization
• Projects should support the interest of the majority population and should not promote dislocation and poverty.
• Elite commercial and entertainment related activities such as malls, ciniplexes, etc should be supported but along with them properly planned hawkers bazaars and economic activity for the lower income groups should be developed to create an inclusive economics, physical and social environment
• Law and order situation should be maintained, improved and made conducive for local as well as migrating
• When strategies are made for poverty alleviation and population reduction planning process these poor must be involved in it. So it will be more effective.
• Govt. should give incentives to the employers for boosting business cycle.
• Govt. should start old aged benefit programmes like, pensions, grants health, basic welfare, and insurance for aged and disabled persons.
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