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The purpose of this paper is to measure the unidimensional and multidimensional inequality in the case of Pakistan and compare their results at the provincial as well as regional (urban and rural areas) level. The authors collected data from Pakistan Social and Living Standard Measurement and Household Integrated Economic Survey for fiscal years of 1998–1999 and 2013–2014.

The authors used Gini coefficient for unidimensional inequality and multidimensional indexing approach of Araar (2009) for multidimensional inequality.

The findings predicted that unidimensional inequality is relatively high in the urban area due to uneven dissemination of income, but multidimensional inequality is quite high in rural areas because of higher disparities among all dimensions. At the provincial level, Punjab has relatively high-income inequality followed by Sindh, KPK and Baluchistan.

This study is a pioneering effort to compare two time periods to explore unidimensional and multidimensional inequality in all provinces of Pakistan and their representative rural-urban regions by applying Araar and Duclos’s (2009) approach. Further, this study opens some new insights for policy makers.