Author | Editor: Aviles, W. (NSI, Inc.)
Six datasets on wealth and status distribution in Pakistan were analyzed: 2015 World Bank quintile and decile estimates of income, International Labor Organization (ILO) income by occupation data from years 2018 and 2014, USAID Demographic Health Survey (DHS) wealth factor scores and agricultural land ownership from 2012-13, and wealth factor scores from 2006-07.
All six datasets paint a picture of a risk acceptant Pakistani population that has slightly decreased over the past decade, and the average Arrow-Pratt score is higher than most countries in this study, indicating a less risk acceptant population than most countries. Interesting variations and shifts between occupational datasets in risk acceptance may explain the success of Imran Khan’s populist campaign; furthermore, the highly risk acceptant scores in the agricultural land ownership datasets highlight the extreme economic inequality that exists in the distribution of agricultural land ownership.
Significance for Risk Taking and Stability
The propensity for risk taking in Pakistan is best understood in the context of Pakistan’s widespread corruption and the lack of competent economic governance. Public discontent possibly fuels frustration with these issues and maybe linked to the populist rise of Imran Khan who ran anti-corruption, economic reform, and a strong anti-Western sentiment that places the blame of VEO activity and instability on the US.
Implications for US Interests
Due to the complex socio-political dynamics in Pakistan and the complex regional interests in Islamabad and across South Asia, the US has paradoxical interests in Pakistan’s stability. The pronounced decrease in social status registered in this report’s analysis of craftsmen coincided with the ascendancy of Imran Khan, and this dynamic is important understanding the populist support that Khan enjoys. The continued success of Imran Khan is supported by his strong anti-Western rhetoric (which resonates with working class Pakistanis), and such sentiment further encourages the growing Sino-Pak relationship. Conversely, a decrease in Imran Khan’s popularity could lead to widespread instability and a larger role for Pakistan’s security forces in political affairs. Such a dynamic would likely lead to more tacit support for VEOs operating in Pakistan, which is antithetical to Washington’s strategic interests.
Implications for China’s Interests
Pakistan’s social cleavages and wealth inequality do not present immediate concerns to China’s economic interests and investments in Pakistan. Given the integral role that Pakistan plays in China’s Belt and Road Initiative (BRI) and in the Chinese-Pakistan Economic Corridor (CPEC), China is more interested in safeguarding their investment and of Chinese citizens working to construct CPEC infrastructure. Such social cleavages and inequality may come to a boiling point that threatens the ability of the Khan regime to deliver on the economic agreements, and in this regard China may pursue activities that seek to stabilize Pakistan’s economy and political security.
Implications for Russia’s Interests
Russia stands to gain the most from instability brought on by economic inequality in Pakistan, provided that Moscow can capitalize on such uncertainty by increasing anti-Western sentiment and further contract US presence.