This book is the main text for post-graduate courses on South Asia's development, economic history and on its political economy. For researchers on Pakistan's economy, it is the key source for reference, and covers a huge and diverse array of data, literature reviews, commentary and analysis.

The first comprehensive fifty-year perspective on Pakistan's economic history, it re-examines the conventional wisdom about development in Pakistan's society and economy, and provides facts and data that are not easily available.

This volume makes a major intervention in the debates around the nature of the political economy of Pakistan, focusing on its contemporary social dynamics. This is the first comprehensive academic analysis of Pakistan's political economy after thirty-five years, and addresses issues of state, class and society, examining gender, the middle classes, the media, the bazaar economy, urban spaces and the new elite. The book goes beyond the contemporary obsession with terrorism and extremism, political Islam, and simple 'civilian–military relations', and looks at modern-day Pakistan through the lens of varied academic disciplines. It not only brings together new work by some emerging scholars but also formulates a new political economy for the country, reflecting the contemporary reality and diversification in the social sciences in Pakistan. The chapters dynamically and dialectically capture emergent processes and trends in framing Pakistan's political economy and invite scholars to engage with and move beyond these concerns and issues.

While policy makers, media, and the international community focus their attention on Pakistan’s ongoing security challenges, the potential of the rural economy, and particularly the agricultural sector, to improve Pakistanis’ well-being is being neglected. Agriculture is crucial to Pakistan’s economy. Almost half of the country’s labor force works in the agricultural sector, which produces food and inputs for industry (such as cotton for textiles) and accounts for over a third of Pakistan’s total export earnings. Equally important are nonfarm economic activities in rural areas, such as retail sales in small village shops, transportation services, and education and health services in local schools and clinics. Rural nonfarm activities account for between 40 and 57 percent of total rural household income. Their large share of income means that the agricultural sector and the rural nonfarm economy have vital roles to play in promoting growth and reducing poverty in Pakistan.

Pakistan is a strategic ally of the US in the 'war on terror'. It is the third largest recipient of US aid in the world. Yet Pakistan is a state run by its army and intelligence service. Operating in the shadows, Pakistan's military industrial complex owns and controls swathes of the economic and political landscape of the country. Military Inc. dares to illuminate the military as an oppressive holding company possessing not just security-related businesses, but also hotels, shopping malls, insurance companies, banks, farms and even an airline. The result is a deeply undemocratic society, where money is funnelled towards the military's economic enterprises, leaving those in need of it impoverished and effectively disenfranchised. With an empirical richness, and a view to Pakistan's recent history, Ayesha Siddiqa offers a detailed and powerful case study of a global phenomenon: corruption, hollow economic growth and elitism. This new edition includes a chapter on the recent developments of the military's foray into the media, and a new preface.

The purpose of this paper is to empirically determine the effects of political instability on economic growth. Using the system-GMM estimator for linear dynamic panel data models on a sample covering up to 169 countries, and 5-year periods from 1960 to 2004, we find that higher degrees of political instability are associated with lower growth rates of GDP per capita. Regarding the channels of transmission, we find that political instability adversely affects growth by lowering the rates of productivity growth and, to a smaller degree, physical and human capital accumulation. Finally, economic freedom and ethnic homogeneity are beneficial to growth, while democracy may have a small negative effect.