Ethnicity and Earnings: An Analysis of Data for Karachi

Pakistan is today, a case study in ethnic strife. Carved out of pre- Independence India in 1947, the country is home to five broad ethnic groups: Punjabis (the dominant segment of the population), Balochis, Pathans and Sindhis. Each has a distinctive culture and language. In spite of broad similarities stemming from a common religion (more than 98 percent of the population is Muslim), several factors combine to create dissension and discord. The fifth ethnic group in Pakistan are the Muhajirs (which literally translates to “Immigrants”) who migrated to Pakistan in large numbers from India in 1947. Most of them settled in Karachi. Pakistan’s largest city, a teeming port city with a current population of around 12 million. Charges of favouritism in the award of jobs abound, and the Muhajirs in particular allege that, not being “sons of the soil,” they are singled out for discriminatory treatment. Given that this is the case, it is surprising that no study has been carried out to ascertain if indeed, earnings differences originate from ethnic differences in Pakistan. This study attempts to examine this issue, and thus settle questions that have led to many a pitched argument.