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A Statistical Investigation of Business Cycles Characteristics in Pakistan

Author

Listed:
  • Niaz Ali

    (MS Economics,)

  • Muhammad Tariq

    (Assistant Professor,)

  • Asia Baig

    (Demonstrator,)

Abstract

This study investigates the business cycle characteristics for Pakistan using three sets of variables namely expenditure components of GDP, nominal variables and real variables. The findings reveal that the volatility of expenditure components are greater than GDP during the full sample of 1973 to 2015. Whereas, in the Pre-SAP and Post-SAP periods i.e. 1973-1988 and 1989-2015, real variables and nominal variables show more volatility than GDP. And, in terms of co-movement, expenditure components of GDP showed strong pro-cyclicality and relationship with GDP against other sets of variables. Moreover, the nominal variables show positive persistence and the business cycles caused by it, lasting for a long time against real variables and expenditure components of GDP. Furthermore, the results show that the correlation between CPI and GDP across all periods is counter cyclical. The stability test results show that business cycles features remained stable during two time periods.

Suggested Citation

  • Niaz Ali & Muhammad Tariq & Asia Baig, 2017. "A Statistical Investigation of Business Cycles Characteristics in Pakistan," Global Economics Review, Humanity Only, vol. 2(1), pages 73-84, December.
    • Handle: RePEc:aaw:journl:v:2:y:2017:i:1:p:73-84
    DOI: 10.31703/ger.2017(II-I).09
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    References listed on IDEAS

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    More about this item

    Keywords

    Business Cycles; GARCH; Volatility; SAP;
    All these keywords.

    JEL classification:

    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
    • Z0 - Other Special Topics - - General

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