How unequal is the size of middle class in the rural urban areas of Punjab province : Evidence from micro data analysis

Purpose Strengthening the middle class has become a major policy goal in both developed and developing economies due to its social, economic, cultural and political importance. Keeping in view the importance of middle class, the purpose of this paper is to measure the size of the middle class in the province of Punjab (the biggest province of Pakistan by population). Design/methodology/approach The study calculates a weighted composite index to measure the size of the middle class in the province of Punjab using the microcosmic data set, and the Pakistan Social and Living Standards Measurement 2010-2011 survey data set. The index is composed of five major socioeconomic dimensions, that is, income, occupation, education, lifestyle and housing. The above-mentioned dimensions are weighted through “principal component analysis”. Findings The results show that 46 percent of the population of Punjab falls in the middle class. Furthermore, the findings explain that middle class is generally an urban phenomenon in Punjab with relatively high level of education and non-manual occupations. Originality/value Only a limited research is available for measuring the middle class in Pakistan. The current research is an attempt to fill this gap by providing some important insight to the research in this area.