EXPLORING SOCIAL PROTECTION’S ROLE IN RURAL ECONOMIC DEVELOPMENT: A CASE STUDY OF EFFECTS ON HOUSEHOLD RESILIENCE AND ENTREPRENEURIAL ACTIVITIES

Abstract

This study investigates the impact of the Benazir Income Support Programme (BISP) on household welfare in Pakistan, with a focus on dietary diversity, food insecurity, poverty, and broader implications for economic empowerment. Using nationally representative data from the Pakistan Social and Living Standards Measurement Survey (PSLM) and the Household Integrated Economic Survey (HIES), the analysis applies both the Linear Probability Model (LPM) and Logit Model to examine how BISP participation influences household well-being. Findings suggest that BISP beneficiaries experience improvements in food consumption and poverty alleviation, though challenges remain for larger households and families with lower literacy levels. Beyond these direct welfare effects, the study highlights BISP’s potential indirect contributions to entrepreneurship and small and medium enterprises (SMEs). By providing income security, cash transfers allow households, particularly women, to engage in micro-enterprises, invest in children’s education, and stimulate local markets, creating multiplier effects within rural economies (Gazdar & Mallah, 2013; Iqbal et al., 2020). These linkages demonstrate that social protection programs like BISP not only address immediate poverty but can also lay the foundation for inclusive economic growth by fostering resilience, enhancing human capital, and supporting small-scale entrepreneurial activity. Policymakers are therefore encouraged to expand cash transfer amounts, integrate vocational training and digital literacy programs, and create synergies between BISP and SME development policies to achieve sustainable poverty reduction and long-term economic transformation (Mustafa et al., 2019; Rehman, 2022; Uddin, 2021).