IMPACT OF GOVERNMENT EXPENDITURE ON INCOME DISTRIBUTION A THEROTICLE ANALYSIS IN THE CASE PAKISTANDr.Masood Mashkoor Siddiqui1*, Dr.Abdul Malik2
- *Corresponding Author:
- Dr.Masood Mashkoor Siddiqui
Department of Commerce
Federal Urdu University of, Karachi, Pakistan
E-mail: [email protected]
The purpose of this study is to find out whether the fiscal policy measures – especially public expenditure – have been able to fulfill the envisaged objective set by the Government. Although several other policy changes have taken place in the economy – exchange rate devaluation, import liberalization, changes in minimum wages, money supply and price reform , it is assumed that the pre-fiscal income distribution has captured these changes and an estimation of the fiscal incidence should be able to indicate the extent to which the government has been able to effect redistribution of income through the tax-expenditure apparatus alone and in what direction . it is fully realized that taxes and public expenditure do alter the market prices of output and factors through inter-relationships of various economic agents and markets in the long run which feed back into the pre-fiscal income distribution pattern but if one is concerned with short-run first order gross effects of the fiscal policy then the proposed study can be illuminating. These effects are spelled out in the section on theoretical and conceptual issues.