Determinants of Personal Earnings in Pakistan: Findings from the Labour Force Survey 1993-94

Zafar Mueen Nasir


The paper explores the role of human and non-human capital
factors in determining the earnings of workers in Pakistan. The Labour
Force Survey data 1993-94, which provides detailed information about
workers, has been used for this analysis. Ordinary least squares
estimation technique has been utilised for the analysis. The analysis is
carried out separately for male and female workers. It is found that in
human capital variables, education plays a dominant role in wage
determination. In non-human capital factors, occupation and size of the
establishments are found to be relevant variables. Other important
variables include regional location and technical training. The sample
selection bias has been observed for female workers whereas no problem
has been observed for male workers, and the bias has been corrected by
using the Heckman procedure, though both corrected and uncorrected
results are reported. Important conclusions and policy implications are
discussed at the end.

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