The Elements of Class Conflict in Pakistan

1.1 Overview of the Topic

Income distribution is a frequency distribution showing number of persons, taxpayers or households classified by levels of income. The unequal distribution of income is a major issue in many countries, mostly in developing countries and in Pakistan it has been a burning since its birth. As the inequality in the distribution rises, it divides the population into small groups with various differences among them, thus fueling a conflict between them. The conflict arises due to difference in the income patterns, employment patterns, wage rates, difference in resources symbolic or material, social status etc. the difference in the lifestyle, wage rates, and the job opportunities in the rural and urban cities of Pakistan cause class conflict, as people living in various locations belong to different income groups. Feudal culture in Pakistan is among the major reasons of class conflict. Landlords have made monopolies which have increased the disparities among the various classes living. Class conflict is a serious problem which causes violent activities such as high crime. Unfortunately our government has been unable to solve this problem of uneven distribution of income, as they themselves are enjoying the class difference existing in our country. Over the past year this conflict has been boiling and will eventually erupt one day. With this segregation of the population into various classes, social gaps have increased and people have become more accustomed to other people who are of similar stature in the society. This is one of the major issues Pakistan is facing, unity among the population is a challenge to the government of Pakistan, but it all trickles down to the fact that the people who are causing this unequal distribution of income are the ones who are leading us. Over the past years, the income distribution in Pakistan has adopted an uneven trend, meaning that there is no significant increase or decrease, thus the notion that the rich are getting richer and the poor are getting poorer, and the result of this is a growing conflict among the various classes that exist in our society today. Other factors such as corruption also play a vital role in this unequal distribution of income, not only at higher levels but at the smallest and lowest level of the society as well.

1.2 Background Information

Since Pakistan came into being, the income distribution has been a serious issue. During the time of partition, many people were stripped of their lands, properties, valuables and other financial assets. The unequal distribution of income we are experiencing today has its roots from the time of the partition of India and Pakistan. Feudalism in those days was at its peak and remnants of it can still be seen in the modern society. Many powerful feudal lords claimed lands by force from people who were financially or socially weak, thus the wealth became concentrated and its effects can be seen today in our society, as the unequal distribution of income. Even today, many influential people such as politicians and local feudal lords all around Pakistan are in control of the major chunk of the income that is generated and flows through the economy, which is why Pakistan also faces extreme poverty. Pakistan has experienced an uneven trend in the distribution of income in the past years, as there is no significant trend of increase or decrease. This uneven pattern of income distribution has been the root cause of the division of the population into various classes on the basis of income inequalities. During the early years of Pakistan, the population was less divided, but with the passage of time and the uneven trend of the income inequality has caused the population to be divided into upper, middle and lower classes based on different employment patterns, wage rates, households, social status and limited resources etc. The formation of these classes has led to the widening of the social gaps between the people and has also led to social exclusion of people belonging to different classes. This has been a common practice in history that people belonging to a similar group or stratum, tend to socialize more i.e. people who share common resources either symbolic or material in nature tend to form stratums. As the general population is divided into these stratums, belief and ideals change, thus a conflict arises due to these changing ideals. Over the past years, since the birth of Pakistan, this conflict between the different classes has been slowly boiling and has erupted into a class conflict based on income disparity.

1.3 Importance of the Study With Respect To the World

The problem of unequal distribution of income exists in almost every country around the world, from the weakest to the strongest economies of the world; income disparity is clear and present. It is also one of the major problems that developing countries face and if not contained in due time, it paves the way for many other problems which are either directly or indirectly linked with it. One of these problems is the class conflict that arises due to income inequality among the general population. The relevance of this problem can be best understood with an example of East and West Germany. In World War II the Allies occupied West Germany and the Soviets occupied East Germany. The border between the two Germany’s was famously known as the Berlin Wall. Since the corporate and industrial might of the Allies was far superior compared to the Soviets at that time, the Allies started injecting billions of dollars in the economy of West Germany, resulting in higher living standards and plentiful jobs for the people. In stark contrast the jobs and living standards in East Germany were inferior, resulting in constant unrest which ultimately substantiated into a major class conflict. Thus throughout the world, we see many similar cases where the major chunk of the economy is concentrated at a singular point, that is the elite or the ruling class, leaving the lower classes with little or no financial assets. Concentration fuels the class conflict in a society and ultimately damages a nation as a whole. The inequality in the distribution is caused by many relevant factors, such as inflation, foreign direct investment, remittances, trade, corruption, feudalism etc. and these are all present in almost every society of the world. Thus the significance of this study cannot be denied with respect to the world.

1.4 Importance of Study With Respect To Pakistan

Since Pakistan’s Inception, the Populace has been plagued with the diabolical issue of income distribution. The seriousness of this issue cannot be denied, since it has been the root cause of constant upheaval in the society in general and also the catalyst of constant unrest, distrust and sometimes violent protests. In other words we have been compromised in a never ending stalemate, since there is no significant trend of increase or decrease of income distribution in Pakistan, thus this kind of uneven trend is giving rise to undesirable hybrid classes based upon this income inequality. The initiation of such classes has led to an avalanche of prejudice, discrimination and more disturbingly, exclusion of significant amount of people from the nucleus of the society. It has also led to the formation of different stratums among the people. With the passage of time this horrendous social exclusion, disparity and discrimination has manifested into an ugly class conflict amongst the people we see today in Pakistan. The mere presence of various classes based on improper income distribution is evidence of its existence. The increasing social gap, distrust and lack of communication between the people, nourishes the problem of income distribution and provides sustenance for its future. The prevailing feudal culture in Pakistan is also one of the major catalysts of the unequal distribution of income in Pakistan. The most influential people or the ruling class has the most concentration of resources; they also include the politicians of Pakistan who are responsible for making policies against this burning issue. Inflation is another factor contributing to the lowering of the purchasing power of the lower classes, which in turn induces a conflict among the general public, as inflation hits hard on the lower classes and has little effect on the elite class. All the foreign investment and the remittances are also controlled by the upper or elite class, thus the flow of money in the economy is limited to a set number of influential or powerful people, while the majority of the population is deprived even the basic necessities of life.

1.5 Research Question

The elements of class conflict in Pakistan.

The problem of class conflict is justified with the increasing gaps between the populations of Pakistan. Various classes exist due to this income disparity. It is due to this income disparity among the people different classes are formed. Thus, there is a clear and present conflict between the classes in our society.

CHAPTER 2

LITERATURE REVIEW

The review of existing literature in the current study area of the income distribution patterns and the class conflict in Pakistan will help in appraising additional information on the subject matter and help in establishing a better understanding of the research that is to be undertaken.

Hasan (2002) made a study on the emerging trends of Pakistan’s upper or elite class which is under heavy influence of the west. The post Bhutto era changed all the pervious trends that the ruling class observed. The elite class now has separated itself from the middle and lower classes and with it, has also lost the trend to use public services. They are more inclined to private services and they are the ones who are embedded deep in Pakistan’s political lobby. They reflect the country’s politics, society and the culture as well. Today, Pakistan’s elite class enjoys the most as income and money is no object to them, they go abroad for vacations and education whereas the majority of the population has little to eat. This gives rise to a class conflict between the general populations and thus differences are uplifted.

Y. So (1991) studied the causes of stratification among people. The author focuses on the study of politics and history in accordance with the class struggle. The author makes the analysis based on three major components, the conditions of class struggle, the entire process of class struggle and the consequences that follow the class struggle both on micro as well as the macro level. By incorporating class struggle into the process stratification theory, the author opens up new a horizon for the analysis. The stratification theory groups people according to income distribution. People possessing similar characteristics form social groups or classes which give rise to social gaps. The Neo-Marxist theory focuses on the production sphere and is the advocate of conflict between the emerging classes. The aim of this study was to analyze the formation of different classes. The study looks at the various forms of class struggle and the ways in which classes are formed with special reference to reasons and causes of this phenomenon.

Strasser (1980) argues that there two principles which are involved in the social inequality, stratum and class formation. It is intended to substantiate the work by comparing the claims of the functional theory of social stratification and to uncover the frame of reference that underlies the analysis of social inequality in a society. The author calls attention to the recent finding of his time in anthropology and ethnology to further explain his thesis and looks at various theories of social inequality, functional, conservative and progressive. Stratum is a group of people sharing common characteristics such as income, occupation, status etc. Socialization is the major cause of the formation of various stratums. People belonging to a similar background tend to socialize more between themselves rather than with people who are different from them. Social inequality among the various classes takes the form of unequal distribution of resources. These resources either symbolic or material are responsible for the conflict among classes. Classes are formed as a result of grouping of similar people belonging to specific interests, whereas strata are formed due to similar lifestyles of various people.

Rashid (1985) examines the feudal culture that has existed since Pakistan’s birth and even now this culture prevails as many of the ruling elites and politicians are among them. Land reforms are imperative for a country like Pakistan, but the people who are responsible for the implementation are the ones who benefit the most out of land. The policy makers and the people who implement the policies are in the politics, and these people compromise the majority of the landlords here in Pakistan. Landlords enjoy the fruits of other people’s hard work which belong to the lower classes that tend to the lands which are not of their own. This tense relationship of worker and master gives rise to a class conflict which will erupt one day. The government is not trying to balance out this unequal distribution of land among the people. There is concentration of all the wealth of the land to one ruling class.

Chandra (1972) stated that since the earliest beginning, Pakistan has been dominated by the ruling class. The author gives a complete assessment of the class character of West Pakistan. Even the Muslim League consisted majority of two classes, the Zamindars and the traders, both of which belong to the upper or elite classes of that time. The study aims at living conditions of the lower or working class, which are still the same even after such a long time. There has not been any significant improvement in the living conditions nor other important sectors for these poor people, even though they comprise the majority of the total population of Pakistan. There has been a significant development in the industrial and the private sector, i.e., inflow of foreign investment, but to no avail, the landlords and the capitalists are only the ones who enjoy the fruits of life, as they comprise all the heavy investors in both the sectors. Landlords have made monopolies, and by doing so the disparities among the classes have further increased ever since.

Crenshaw and Ameen (1993) in their study of the different dimensions of social inequality in the third world, reveal that the modernization and the ecological-evolutionary theories provide more evidence regarding the social inequality than the either the dependency/world systems or the urban bias theory. They provide a cross national assessment of the determinants of income inequality. They also shed light on the various conclusions that can be drawn from various theories. Injection of foreign capital provides opportunities for some people, but it also widens the gap as many people are unable to capitalize on the certain amount of capital. Thus only the people who are strongly embedded and/or in the mainstream, are the ones who are able to capitalize. The analysis point towards the economic growth and the development of the rural areas to reduce mortality and stabilize the income inequality.

Ahmed (1996) in his study comments that in a rapidly progressing world, ethnic, religious and social conflicts are tearing states apart not only in the developed world, but also in the lesser developed third world countries. Pakistan is divided into many ethnic groups according to the author, the largest group being the Punjabis, who comprise mainly of the upper and middle classes. However social inequality in rampant in the whole country as there are small pockets of people who have similar access to resources, thus forming various ethnic groups and/or classes, which include Sindhi, Pushtoon and Balochi people, who are less developed and less embedded. Even though Pakistan is rapidly growing but there are elements that hinder the growth of people and inhibit potential factors which work to decrease this chasm between the people of Pakistan. National integration is a desirable goal but it has caused a lot of problems in the past, such as oppression. Even if national equity is promoted and there is harmony among the different groups, there would yet be emerging ideas of different stances, and this time around would have an adverse effect.

Bulir (2001) made a study using the traditional Kuznets model. Inflation reduces the purchasing power of the poor people; it also tends to decrease the general income thus increasing social gaps. The government can tax the rich to cover the gap but there are only a few honest taxpayers as opposed to the number of poor people in Pakistan. This ignites a certain conflict among the people, as a certain image is developed for the tax evaders, who are mostly the ruling class or the elites. People belonging to the lower class are hit heavily by inflation, as they are already short on resources, and after further reduction in their purchasing power, they are forced to corruption. Lower inflation rates, in addition to the level of development and fiscal redistribution are found to improve income equality and their impact is uniform for all levels of GDP per capita, thus low inflation rates improve the income inequality. Level of development; state employment, fiscal redistribution, and price stability are found to improve income inequality in a given country. The positive impact of price stability on income distribution is nonlinear. When inflation is reduced from hyperinflationary levels, there is a significant reduction in the income inequality also, while if it is decreased further, then there are small gains in the country’s gini coefficient.

Kentor (2001) observed the effects of globalization on the income distribution, population growth and the economic development. The goal was to develop the linkage between them, and it is evident that they are inter-related parts of a complex system of unequal economic, social and political relationships. Globalization has effects on the income inequality and income distribution, but there are no properly demarked good or bad effects to it. Where there is a negative effect of globalization on the per capita GNP growth, there is also a positive impact on the trade openness. Policies should be made according to the given circumstances at hand, not by prediction.

Hussain, Sharif, Hasan (2009) studied the impacts of openness of trade, FDI and remittances on the income distribution and the income inequality in Pakistan. Increased openness of trade leads to economic growth which reduces poverty and makes income distribution more equal. Trade liberalization has been a factor in reducing the income distribution as there is a significant increase in the total trade over the past years. Pakistan has also reduced tariffs from 200% to only 25%. Studies show that FDI has a positive effect on income distribution, but owing to the unstable political and economic conditions it has not risen considerably. FDI was restricted to only few areas but since it opened up to the industrial sector, Pakistan has witnessed a considerable amount of increase in FDI (poor in the 70’s and began rising in the 80’s). However the extent of FDI had good effects on income distribution in Pakistan. Remittances, also play a vital role in the economy, Pakistan had high remittances through the 70’s and 80’s but saw a decline after that, yet after 2000, Pakistan again saw rapid increase in the remittances, Pakistan is trying to open up the economy by privatization. This will ultimately cause growth in the economy and reduce poverty and equalize the income inequality. Thus their study revealed that the income inequality in Pakistan follows an uneven pattern, meaning that there is no significant increase or decrease.

CHAPTER 3

METHODOLOGY

3.1 Research Type

My Research falls under the category of a quantitative research. I gathered data and put it through a series of statistical techniques to prove the hypothesis derived in the research

3.2 Data Type and Research Period

My Research was done by using the primary data. Primary data was collected to study the class conflict, as no historical data is currently available. Questionnaire provided me with relevant information to conduct the research

3.3 Sources of Data

A questionnaire was floated asking general questions related to the issue of class conflict in Pakistan

3.4 Theoretical Framework

3.5 Variables & Definitions

Inequality

The degree to which the distribution of economic welfare generated in an economy differs from that if equal shares among its inhabitants

(Dictionary of Economics, Graham Bannock)

Stratum

Division of people according to some variable

Feudalism

A European system flourishing between 800-1400 based upon fixed relations of lord to vassal

(www.thefreedictionary.com)

Income Distribution

The various levels of income existing within a given population

(Dictionary of Economics, Graham Bannock)

Class Conflict

Conflict between different classes in a community resulting from different social or economic positions and reflecting opposed interests

(www.dictionary.reference.com)

Income Disparity

In economic context, it refers to the difference in wages of people

3.6 Population, Working Population and Planned Sample

The questionnaire was completed by 50 people of Lahore. Questionnaire asked questions regarding the social class conflict existing in our society.

3.7 Research Hypothesis

H0: Class conflict is caused due to income disparity

H1: Class conflict is not caused due to income disparity

H0: Social gaps and social exclusion lead to the class conflict

H1: Social gaps and social exclusion does not lead to class conflict

H0: Division of stratums is a major reason for class conflict.

H1: Division of stratums is not a major reason for class conflict.

H0: There are social gaps between the various classes in Pakistan

H1: There are no social gaps between the various classes in Pakistan

3.8 Techniques

For the analysis of the data collected, the statistical technique of regression was used to build and establish linkages between the variables used in the research and finally deriving the conclusion from the results of the regression analysis.

3.9 Data Analysis

The statistical software Mini tab was used to apply the regression technique to analyze the data. The software provided with graphs, tables and charts after running regression.

3.10 Data interpretation

The data was interpreted using the regression results. Based on the current analysis the main aim of the study was to understand which element was the major one of class conflict.

CHAPTER 4

RESULTS AND ANALYSIS

4.1 Results

Multiple Regression Analysis

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Dependent variable: Class Conflict

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Standard T

Parameter Estimate Error Statistic P-Value

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CONSTANT -0.0519046 0.421089 -0.123263 0.9024

Income Disparity 0.24955 0.122053 2.04461 0.0466

Socialization 0.753118 0.148753 5.06289 0.0000

Stratification 0.0101818 0.092964 0.109524 0.9133

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Analysis of Variance

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Source Sum of Squares Df Mean Square F-Ratio P-Value

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Model 4.90069 3 1.63356 10.81 0.0000

Residual 6.95066 46 0.151101

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Total (Corr.) 11.8514 49

R-squared = 61.3514 percent

R-squared (adjusted for d.f.) = 57.5264 percent

Standard Error of Est. = 0.388717

Mean absolute error = 0.318889

Durbin-Watson statistic = 1.52396

Class Conflict = -0.0519046 + 0.24955*Income Disparity +0.753118*Socialization + 0.0101818*Stratification

4.2 Findings & Analysis

The regression model describes the relationship of socialization, stratification and income disparity with class conflict. It explains how socialization, stratification and income disparity affect class conflict. As we can see from the above equation that income disparity, socialization and stratification is directly linked with class conflict as all three variables have a positive relationship. Since the P-value in the ANOVA table is less than 0.01, there is a statistically significant relationship between the class conflict and the 3 independent variables at the 99% confidence level. The R-Squared statistic indicates that the model as fitted explains 61.3514% of the variability in Class Conflict. The adjusted R-squared statistic, which is more suitable for comparing models with different numbers of independent variables, is 57.5264%. The standard error of the estimate shows the standard deviation of the residuals to be 0.388717. This value can be used to construct prediction limits for new observations by selecting the Reports option from the text menu. The mean absolute error (MAE) of 0.318889 is the average value of the residuals. The Durbin-Watson (DW) statistic tests the residuals to determine if there is any significant correlation based on the order in which they occur in the data file. Since the DW value is greater than 1.4, there is probably not any serious auto correlation in the residuals.

In the model the highest p-value on the independent variables is 0.9133, belonging to stratification. Since the p-value is greater or equal to 0.10, so this variable is not significant at the 90% confidence level. Therefore, we can say that stratification have little and no effect on the dependent variable, class conflict.

Questionnaire was floated by various people including students and professors of my university i.e. Lahore School of Economics, Doctors working in CMH hospital, Students of LMDC, Shop keepers of H-Block market DHA and people working as drivers and cooks in my colony. The main purpose of getting questionnaire filled from people belonging to various income groups was to clearly study and understand the relationship of socialization, stratification and income disparity with the class conflict issue. The only limitation of doing this primary research was that the sample size of 50 people was very low in order to draw a conclusion as the topic is very wide and each and every individual has his/her own views on the class conflict topic. Overall people surveyed, were of the view that class conflict did exist in our society and gave rise to problems such as income disparity and it divided the population into various stratums.

4.3 Hypothesis testing

H0: Class conflict is caused due to income disparity

H1: Class conflict is not caused due to income disparity

As the results show the p-value of income disparity to be 0.0466 which is less than 0.05 thus we accept Ho at 95% confidence interval. This means that income disparity causes class conflict. According to the respondents, class conflict is a result of the income disparities as these days in Pakistan the rich are getting richer day by day and the poor are getting poorer. Class conflict is dependent upon income disparities.

H0: There are social gaps between the various classes in Pakistan

H1: There are no social gaps between the various classes in Pakistan

The p-value of the information in the regression analysis is 0.0000. As the p-value is less than α which is 0.05, we accept the null hypothesis and say that social gaps do exist between the various classes in Pakistan. It should be noted that the p-value is very small and is significant. Majority of the respondents were of the view that social gaps are present in the various classes of Pakistan.

H0: Social gaps and social exclusion lead to the class conflict

H1: Social gaps and social exclusion does not lead to class conflict

The p-value of socialization in the regression analysis is 0.000 which is less than 0.05 we accept Ho at 95% confidence level. This means that social gaps led to the problem of class conflict. Majority of people said that wide social gaps and differences and social exclusion led to class conflict. They were of the view that this separation between the classes will lead to a major conflict among the general public in Pakistan.

H0: Division of stratums is a major reason for class conflict.

H1: Division of stratums is a major reason for class conflict.

In the regression analysis we can see that the p-value of stratification is 0.9133 which is greater than 0.05 thus we reject the null hypothesis at 95% confidence level. This means that stratification is not a major reason of the class conflict problem. One of the limitations behind this result could be that the sample size is very small, which is in sufficient to draw a conclusion regarding stratification and its relationship with class conflict.

Conclusion

From the above argument, it is concluded that there is a marked class conflict in the population of Pakistan based on the unequal distribution of income in Pakistan. Corrupt officials, low number of honest taxpayers and resistance to change are some of the factors which contribute to fuel this ongoing conflict among the people. Pakistan is also facing a great threat from security point of view as well as inefficient monetary policies, which also hinders economic growth. Hence the people are divided into the various groups mentioned in the paper, according to difference in income, status, amount of resources and other contributing factors. According to the results, stratification among the people does not hold much importance, but it is a minor contributing factor in the class conflict. Socialization, however is an important variable in the class conflict, people of similar backgrounds belong to a similar type of social status tend to socialize more than people belonging to other classes. This is a common practice that people with similar resources either material or symbolic will from a social group and tend to exclude people who are different from them.