The document discusses Pakistan's economy and economic institutions. It defines key economic concepts like production, distribution and consumption. It also outlines Pakistan's economic systems of capitalism and socialism. It then describes modes of subsistence like pastoralism, horticulture and agriculture. It identifies issues facing Pakistan's economy like fiscal and monetary policy challenges, power crisis, low exports and high imports. It concludes by suggesting reforms like increasing exports, improving governance, education and developing human capital.

1. Economical Institution and
Issues of Pakistan
Prepared by
Zeeshan Hassan Saeed 743
Taha Javed 763
Faseeh ud din 739

2. What is Economy ?
“The Production, Distribution and Consumption of Services by
different agents is known as economy.”

3. What is it made up of?
 Production
 Distribution of Trade
 Consumption of Goods
 Consumption of Services

4. Why is economy is important ?
 The economy is an indicator of development and sustainability.
 A good economy ensures better chances of survival and development or a state.
 If we understand the cycles and system in Economics, we can better understand
how to manage our money and society.

5. ECONOMIC INSTITUTIONS & SYSTEM
 ECONOMIC SYSTEMS
• CAPITALISM
• SOCIALISM
 MODES OF SUBSISTENCE
• PASTORALISM
• HORTICULTURE
• AGRICULTURE
• INDUSTRIALIZATION
 LABOR RESOURCES AND PATTERNS
• COOPERATIVE LABOR
• DIVISION OF LABOR BY GENDER
• DIVISION OF LABOR AGE
 DISTRIBUTION AND EXCHANGE
• REDISTRIBUTION
• RECIPROCITY

6. ECONOMIC SYSTEMS
CAPITALISM
 It is a system under which resources
and means of production are
privately owned, citizens are
encouraged to seek profit for
themselves, and success or failure of
an enterprise is determined by free-
market competition.
 Example :The United States is one of the
most purely capitalistic societies in the
world. Most U.S. businesses are privately
owned, but the government does regulate
business practices.
SOCIALISM
 It is a system under which resources
and means of production are owned
by the society as a whole, rights to
private property are limited, the
good of the whole society is stressed
more than individual profit, and the
government maintains control of the
economy
 Example: China is a socialist
country. The government owns and
controls almost all natural resources.

7. MODES OF SUBSISTENCE:
PASTORALISM
 Pastoralism is a form of animal husbandry, historically by nomadic people who
moved with their herds.
 The species involved included: cattle,
camels, goats, yaks llamas, reindeer, horses and sheep.
 Pastoralism occurs in uncultivated areas. Wild animals eat
the forage from the marginal lands and the humans survive
from milk, blood, and often meat of the herds and often trade by-products
like wool and milk for money and food.
 Pastoralists often compile wealth and participate in international trade. Pastoralists
have trade relations with agriculturalists, horticulturalists, and other groups.

8. HORTICULTURE
 With the advent of plant domestication, some societies took horticulture in which
small communities of gardeners work with simple hand tools, using neither
irrigation nor plow.
 It is a branch of agriculture and it plays an important
role in economy.
 Horticulture has a great share in earning the foreign
exchange for the country.
 Production, processing and marketing of ornamental flowers, medicinal herbs and
mushroom farming are also included in horticulture cropping.

9. AGRICULTURE
 It is crop cultivation that involve using technologies other than hand tools, such as
irrigation , fertilizers and wooden and metal plow pulled by harness draft animals .
 Some developed countries used fuel powered tractors to cultivate large tract of
lands.
 Pakistan's principal natural resources are arable land and water. Agriculture
accounts for about 21% of Pakistan's GDP and employs about 43% of the labor
force.
 In Pakistan, the most agricultural province is Punjab where wheat and cotton are
the most grown.
 Mango orchards are mostly found in Sindh and Punjab provinces that make
Pakistan the world's 4th largest producer of mangoes.

10. AGRICULTURE
 Distribution of land owner ship in Pakistan
Distribution of Land Ownership in Pakistan
1972 1980 1990 2000
Gini Coefficient 0.66 0.65 0.66 0.66
% of landless
households
65.0 63.3
% Share of Holdings
<5 acres
a. Households 47.3 n.a. 54.4 61.2
b. Land 5.4 n.a. 11.4 14.8
% Share of Holdings
50+ acres
a. Households 3.3 n.a. 2.8 2.0
b. Land 22.4 n.a. 34.0 29.7
SOURCE: Report No. 39303-PK Pakistan, Promoting Rural Growth and Poverty Reduction,
March 30, 2007, Sustainable and Development Unit. South Asia Region. Document of the World Bank

11. INDUSTRIALIZATION
 The process in which a society or country (or world) transforms itself from a primarily
agricultural society into one based on the manufacturing of goods and services.
 Individual manual labor is often replaced by mechanized mass production and craftsmen
are replaced by assembly lines.

12. DISTRIBUTION AND EXCHANGE SECTOR
 In society without money, rewards for labor are directly compensated.
 REDISTRIBUTION-
• It is a form of exchange in which goods flow into a central place where they are sorted,
counted and reallocated.
• It involves power. Goods are stored in one central place and then distributed by the leaders
in order to gain or main power; to assure support of followers; and to establish alliances.
• Example Pakistan stock exchange market; state bank
 RECIPROCITY-
• The exchange of goods and services of approximately equal value, between two parties.
Example: Gift-giving.

13. LABOR RESOURCES AND PATTERNS SECTORS
 COOPERATIVE LABOR -
• The effort involves the whole community, a festive spirit permeates the work.
Example: Bayanihan
 Division of Labor by Gender
• Women’s work tend to be confined to traditional roles as dictated by their
biological characteristics.
• Men’s work tend to be those requiring physical strength, frequent travel,
assumption of high level of risk and danger.
 Division of Labor by Age
• Elderly people are expected to contribute much food.
• Older men and women alike play an essential role in spiritual matters,
• Elders with their past experiences are considered as repositories of knowledge and
wisdom especially in non-literate societies.
 CRAFT SPECIALIZATION
• They perform special tasks

14. Role of Economic Institutions
 Economics has variously been defined as a social science that involves itself in the study and
analysis of production, distribution as well as consumption of goods and services.
 Advanced modern economic theories pay very close attention to institutions. In institutional
economies, institutions are deemed to play a very central role in shaping the behavior of other
players In an economic setting.
 Following are the functions of economic institution which include
• Social stratification,
• Power and authority,
• Interdependence of other Institutions,
• Needs satisfaction,
• Employment,
• Division of Labor and Provision of funds.

15. Economical Issues in Pakistan
 Pakistan’s economy continued to face challenges.
 Fiscal Policy
 Monetary Policy
 Power Crisis
 Law and order situation
 Low export and High Import
 Lack of tourism
 Economical

16. Economical Issues in Pakistan

17. Fiscal Policy
 Fiscal policy is the means by which a government adjusts its spending levels and tax rates
to monitor and influence a nation's economy. It is the sister strategy to
monetary policy through which a central bank influences a nation's money supply.
 The key objective of Pakistan fiscal policy is sustained economic growth.
 Poverty reduced.
 The creation of job opportunities.
 Investment in physical and human capital.

18. Monetary Policy:
 Monetary policy will have to play an active role in moving the country towards better
economic management.
 Foreign reserve currency.
 Printing of Rupees is also a problem.
 Create inflation.

19. Power Crisis:
 The most significant problem which has effected the growth of state adversely.
 Capital flight.
 Increasing Unemployment.
 Uses of alternative ( solar energy, coal energy, wind energy) which might reduce load.

20. Law And Order:
 Poor economy are always the poor (vicious circle).
 Positive relation between crime and major economic variables.
 Increase in inflation, poverty, unemployment, and decline in investment.
 Modern training may be imparted to police force to combat terrorism.

21. Low Export And High Import:
 Crucial problem is budget deficit, shows that import is more than export.
 Create gap between import and export deficit.
 Restrict import and rely own manufacturing goods.
 Reduce gap between import and export.

22. Lack Of Tourism:
 Pakistan is a scenic beauty.
 Past years this beauty play important role to increase economy growth.
 Natural disaster and law and order problem decrease tourism. (failure of implementation of
safety rules and regulations)
 It brings foreign currency.
 Regain peace, attract the tourist.
 Improved economy condition.

23. Ours common problems:
 Capitalism at its Extreme
 GDP
 Tax Payers (lager and unbalance tax)
 No Budget Implementation
 No implementation Of Foreign Aid
 Inflation
 Declining Exports
 External Loans (more import material & goods)
 Political Instability
 Poverty
 Lack of knowledge of technology

24. Overall review of issues:
 We have big budge but no implementation.
 We have capitalize economies services but we have no job. We are facing the lack of
job; unemployment is on its higher rate.
 The gross domestic product (GDP) is one the primary indicators used to gauge the
health of a country's economy. It represents the total dollar value of all goods and
services produced over a specific time period …you can think of it as the size of the
economy.

25. GDP RATE OF PAKISTAN

26. SUGGESTION
 In order to improve our economic system:
 we should focus mainly on exports and should fine way to enhance our export
trades throughout the world.
 We must Change in National Psyche and Mindset.
 Work efficiently on Governance, Devolution and Decentralization.
 We must Improve the use of Technology.
 We must Building up of Human Capital.
 Government should improve literacy rate by initiating educational reforms and
establishing more educational institution throughout the country
 We must develop more and qualified Young Labor Force.
 We must improve our education system to build up qualified young labors.

27. CONCLUSIONS
 Today the pathetic condition of our economy is because of our Poor planning , Lack
of timely decisions and due to this we are unable to respond to every difficult
situations efficiently.
 Pakistan and its people has a lot of potential and we are blessed with a whole lot of
natural resources.
 If the government plans wisely, and the people work hard, the economy of Pakistan
can be taken to a whole new level.