MEASURING INEQUALITY OF CONSUMPTION AND OPPORTUNITIES IN PAKISTAN 2001-02 and 2004-05

Inequality is increasingly recognized as an important issue in policy discussions. the paper examines the changes in inequality profile from the most recent nation-wide household survey data. the results suggest that consumption inequality increased in pakistan. though inequality increased in both rural and urban areas, the rise in inequality was more pronounced in urban areas than in rural areas. while both the poorest and middle income groups upto 7^th decile lost their consumption share, the richest last two deciles gained in their consumption share implying that inequality in pakistan increased at the expense of the poor and the middle income groups. the ratio of the highest to the lowest decile which measures the gap between the richest and the poorest also worsened indicating an increased rich-poor gap over the period. the results relating to inequality of opportunities in education and health suggest a high degree of inequality across consumption deciles. the rich-poor gap was high in literacy, enrollment rates at primary, middle and matric level of the school going population by consumption deciles. nevertheless, these indicators improved between 2001-02 and 2004-05 not only for the country as whole but also for the rural and urban areas. these results suggest that while rapid economic growth seems to have increased consumption inequality, the rise in government spending on education and health appears to have reduced the inequality of opportunity during this period.