COVID-19: Estimating impact on the economy and poverty in Pakistan: Using SAM Multiplier Model
Social Accounting Matrix (SAM) multiplier analysis has been employed to assess the impacts of COVID-19 on various macroeconomic variables including Gross Domestic Product (GDP), employment, and poverty in Pakistan. SAM multiplier models are well-suited to estimate the direct and indirect effects of...
| Autores principales: | , , , , , |
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| Formato: | Artículo preliminar |
| Lenguaje: | Inglés |
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International Food Policy Research Institute
2020
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| Materias: | |
| Acceso en línea: | https://hdl.handle.net/10568/143930 |
| _version_ | 1855541300004126720 |
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| author | Moeen, Muhammad Saad Haider, Zeeshan Shikoh, Sania Haider Rizwan, Noormah Davies, Stephen Rana, Abdul Wajid |
| author_browse | Davies, Stephen Haider, Zeeshan Moeen, Muhammad Saad Rana, Abdul Wajid Rizwan, Noormah Shikoh, Sania Haider |
| author_facet | Moeen, Muhammad Saad Haider, Zeeshan Shikoh, Sania Haider Rizwan, Noormah Davies, Stephen Rana, Abdul Wajid |
| author_sort | Moeen, Muhammad Saad |
| collection | Repository of Agricultural Research Outputs (CGSpace) |
| description | Social Accounting Matrix (SAM) multiplier analysis has been employed to assess the impacts of COVID-19 on various macroeconomic variables including Gross Domestic Product (GDP), employment, and poverty in Pakistan. SAM multiplier models are well-suited to estimate the direct and indirect effects of unanticipated demand-side shocks and short-term fluctuations on various sectors and agents in the economy, such as those caused by the COVID19 pandemic. The results show that Pakistan’s GDP declined by 26.4 percent from mid-March to the end of June 2020 (14 weeks) compared to a non-COVID scenario. Services were hit the hardest, registering losses of 17.6 percent, followed by industry with losses of 6.7 percent. Agriculture turned out to be resilient and remained relatively unhurt, falling by 2.1 percent. All households witnessed a reduction in incomes, but higher-income quartiles appeared to have lost more than lower-income ones. Our approach for economic impact with mitigation measures is to assess the effectiveness of Emergency Response Packages (ERP) by altering the remittances to levels that reflect the magnitude of the support from the government. The total government expenditures were directed towards different kinds of households of PKR 318.6 billion (USD 2.12 billion). This led to a reduction of about USD 3.1 billion in GDP losses, which, compared to the amount spent implied a multiplier of 1.4 in GDP per PKR spent. The national poverty rate soared to 43 percent and 38.7 percent in April and May respectively. The Government’s cash transfers program proved highly effective and led to 11 percent reduction in poverty rate during the pandemic. The recovery scenarios indicate a cumulative GDP loss of USD 11.8 billion and 11.1 USD billion under slow and fast recovery scenarios, respectively, by December 2020. Our estimates show that Pakistan’s annual GDP (at market prices) will register a decline of 4.6 percent in the year 2020 due to negative effects of the pandemic and sluggish economic recovery. Poverty is expected to stabilize at 27.6 percent and 27.4 percent for the two recovery scenarios by December 2020. |
| format | Artículo preliminar |
| id | CGSpace143930 |
| institution | CGIAR Consortium |
| language | Inglés |
| publishDate | 2020 |
| publishDateRange | 2020 |
| publishDateSort | 2020 |
| publisher | International Food Policy Research Institute |
| publisherStr | International Food Policy Research Institute |
| record_format | dspace |
| spelling | CGSpace1439302025-11-06T07:40:29Z COVID-19: Estimating impact on the economy and poverty in Pakistan: Using SAM Multiplier Model Moeen, Muhammad Saad Haider, Zeeshan Shikoh, Sania Haider Rizwan, Noormah Davies, Stephen Rana, Abdul Wajid models economic impact covid-19 capacity development household income disease prevention gross national product poverty Social Accounting Matrix (SAM) multiplier analysis has been employed to assess the impacts of COVID-19 on various macroeconomic variables including Gross Domestic Product (GDP), employment, and poverty in Pakistan. SAM multiplier models are well-suited to estimate the direct and indirect effects of unanticipated demand-side shocks and short-term fluctuations on various sectors and agents in the economy, such as those caused by the COVID19 pandemic. The results show that Pakistan’s GDP declined by 26.4 percent from mid-March to the end of June 2020 (14 weeks) compared to a non-COVID scenario. Services were hit the hardest, registering losses of 17.6 percent, followed by industry with losses of 6.7 percent. Agriculture turned out to be resilient and remained relatively unhurt, falling by 2.1 percent. All households witnessed a reduction in incomes, but higher-income quartiles appeared to have lost more than lower-income ones. Our approach for economic impact with mitigation measures is to assess the effectiveness of Emergency Response Packages (ERP) by altering the remittances to levels that reflect the magnitude of the support from the government. The total government expenditures were directed towards different kinds of households of PKR 318.6 billion (USD 2.12 billion). This led to a reduction of about USD 3.1 billion in GDP losses, which, compared to the amount spent implied a multiplier of 1.4 in GDP per PKR spent. The national poverty rate soared to 43 percent and 38.7 percent in April and May respectively. The Government’s cash transfers program proved highly effective and led to 11 percent reduction in poverty rate during the pandemic. The recovery scenarios indicate a cumulative GDP loss of USD 11.8 billion and 11.1 USD billion under slow and fast recovery scenarios, respectively, by December 2020. Our estimates show that Pakistan’s annual GDP (at market prices) will register a decline of 4.6 percent in the year 2020 due to negative effects of the pandemic and sluggish economic recovery. Poverty is expected to stabilize at 27.6 percent and 27.4 percent for the two recovery scenarios by December 2020. 2020-12-01 2024-05-22T12:18:10Z 2024-05-22T12:18:10Z Working Paper https://hdl.handle.net/10568/143930 en https://doi.org/10.1186/2193-2409-2-4 Open Access application/pdf International Food Policy Research Institute Moeen, Muhammad Saad; Haider, Zeeshan; Shikoh, Sania Haider; Rizwan, Noormah; Davies, Stephen; and Rana, Abdul Wajid. 2020. COVID-19: Estimating impact on the economy and poverty in Pakistan: Using SAM Multiplier Model. PACE Policy Working Paper December 2020. Washington, DC: International Food Policy Research Institute (IFPRI). https://doi.org/10.2499/p15738coll2.134244. |
| spellingShingle | models economic impact covid-19 capacity development household income disease prevention gross national product poverty Moeen, Muhammad Saad Haider, Zeeshan Shikoh, Sania Haider Rizwan, Noormah Davies, Stephen Rana, Abdul Wajid COVID-19: Estimating impact on the economy and poverty in Pakistan: Using SAM Multiplier Model |
| title | COVID-19: Estimating impact on the economy and poverty in Pakistan: Using SAM Multiplier Model |
| title_full | COVID-19: Estimating impact on the economy and poverty in Pakistan: Using SAM Multiplier Model |
| title_fullStr | COVID-19: Estimating impact on the economy and poverty in Pakistan: Using SAM Multiplier Model |
| title_full_unstemmed | COVID-19: Estimating impact on the economy and poverty in Pakistan: Using SAM Multiplier Model |
| title_short | COVID-19: Estimating impact on the economy and poverty in Pakistan: Using SAM Multiplier Model |
| title_sort | covid 19 estimating impact on the economy and poverty in pakistan using sam multiplier model |
| topic | models economic impact covid-19 capacity development household income disease prevention gross national product poverty |
| url | https://hdl.handle.net/10568/143930 |
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