Abstract
This study aims to assess the impact of energy short-fall on poverty in macroeconomic framework in Pakistan. The study has used the difference between energy demand and its supply as proxy for energy short-fall and poverty head count ratio as an indicator of poverty incidence. This study has employed ARDL bounds testing approach that confirms the existence of long run relationship between energy short-fall and poverty levels. Error correction term of the estimated model exhibits that approximately 47% of the departures from long run equilibrium value would be corrected each year. The findings show that GDP per capita and government expenditure exhibits negative impact on poverty. Whereas, energy short-fall, unemployment rate and inflation rate show strong positive impact on poverty level. The study concludes that energy sector reforms are required on priority basis to alleviate poverty in Pakistan.