A STUDY ON THE IMPACT OF POPULATION GROWTH AND URBANIZATION ON KARACHI’S ECONOMIC GROWTH

Abstract

The study aims to assess the complex dynamics of population growth, urbanization, and economic performance in Karachi using a multivariate data set of 86 observations on 57 variables. The average GDP was $9.08 million (SD = $6.41 million), while per capita income was low at $3.7, showing a disparity in income distribution among the cities. The urban population averaged 41.9 million, with a 2.56% growth rate in urbanization. Environmental degradation is rife, with the air quality index averaging 51.4 and water pollution averaging 68.1. Carbon emissions and fossil fuel consumption had also increased, averaging over 51 units and 0.60, respectively. Random Forest Regression had the highest accuracy of all the techniques used (R² > 0.99, RMSE ≈103,957), identifying urban population, carbon emissions, and youth unemployment as key predictive drivers. The SEM analysis showed a significant impact of urban population on GDP (β = 0.4654); however, per capita income did not play an important role. One-sample t-tests confirmed that the urban population (t = 13.36, p < 0.001) and CO₂ emissions (t = 16.83, p < 0.001) had significant impacts. While GDP was increasing, poverty and unemployment were also rising, indicating the increasing inequality in wealth distribution. Clustering (KMeans; silhouette = 0.5524) formed three demographic-economic segments. This study indicates that the economic progression of Karachi is intricately interlinked with rapid urbanization while conversely being challenged with structural inequities.