IDEAS home Printed from https://ideas.repec.org/a/ani/irdjoe/v4y2022i3p394-399.html
   My bibliography  Save this article

Identification and Evaluation of Decisive Factors in the Growth of Automobile Industry of Pakistan

Author

Listed:
  • Rukhsana Rasheed

    (Department of Management Sciences, The Govt. Sadiq College Women University, Bahawalpur, Pakistan)

  • Mazhir Nadeem Ishaq

    (Department of Economics, The Islamia University of Bahawalpur, Pakistan)

  • Fahad Malik

    (Department of Economics, The Islamia University of Bahawalpur, Pakistan)

Abstract

Pakistan’s automobile industry is small in Asia but its growth is the fastest in this region. This industry contributes 30 billion rupees to national exchequer through taxes and contributes around 2.8 percent in GDP. Hence, it is imperative to study the economic factors that are responsible for influencing this industry in this country. The present study is a quest in this domain. Economic factors that determine car sales such as GDP growth, CPI inflation, interest rate, exchange rate, unemployment rate, and fuel prices are used. The period of this study is from 1999-2021. ARDL modeling approach is used to test and estimate the potential cointegrating relationship between the aforementioned variables. Results of this study showed that car sales are affected by changes in the interest rate and unemployment rates in the short run. Factors such as GDP growth, CPI inflation, unemployment rate, and petrol prices significantly affect the car sales in the long run. The performance of automobile industry may be improved by open up domestic market to cut the import bill and to protect the local industry from foreign competition for the benefit of consumers.

Suggested Citation

  • Rukhsana Rasheed & Mazhir Nadeem Ishaq & Fahad Malik, 2022. "Identification and Evaluation of Decisive Factors in the Growth of Automobile Industry of Pakistan," iRASD Journal of Economics, International Research Alliance for Sustainable Development (iRASD), vol. 4(3), pages 394-399, September.
    • Handle: RePEc:ani:irdjoe:v:4:y:2022:i:3:p:394-399
    DOI: 10.52131/joe.2022.0403.0087
    as

    Download full text from publisher

    File URL: https://journals.internationalrasd.org/index.php/joe/article/view/856/546
    Download Restriction: no
    File URL: https://journals.internationalrasd.org/index.php/joe/article/view/856
    Download Restriction: no
    File URL: https://libkey.io/10.52131/joe.2022.0403.0087?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. M. Hashem Pesaran & Yongcheol Shin & Richard J. Smith, 2001. "Bounds testing approaches to the analysis of level relationships," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 16(3), pages 289-326.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Karasoy, Alper, 2022. "Is innovative technology a solution to Japan's long-run energy insecurity? Dynamic evidence from the linear and nonlinear methods," Technology in Society, Elsevier, vol. 70(C).
    2. Bruce Morley, 2009. "A Comparison of Two Alternative Monetary Approaches to Exchange Rate Determination over the Long-Run," International Econometric Review (IER), Econometric Research Association, vol. 1(2), pages 63-76, April.
    3. Bloch, Harry & Rafiq, Shuddhasattwa & Salim, Ruhul, 2015. "Economic growth with coal, oil and renewable energy consumption in China: Prospects for fuel substitution," Economic Modelling, Elsevier, vol. 44(C), pages 104-115.
    4. Villanthenkodath, Muhammed Ashiq & Mahalik, Mantu Kumar, 2021. "Does economic growth respond to electricity consumption asymmetrically in Bangladesh? The implication for environmental sustainability," Energy, Elsevier, vol. 233(C).
    5. Shahbaz, Muhammad & Hoang, Thi Hong Van & Mahalik, Mantu Kumar & Roubaud, David, 2017. "Energy consumption, financial development and economic growth in India: New evidence from a nonlinear and asymmetric analysis," Energy Economics, Elsevier, vol. 63(C), pages 199-212.
    6. Noraida, A.W. & Abdul-Rahim, A.S. & Othman, Mohd, 2017. "The Impact of Sustainable Forest Management (SFM) Practices on Primary Timber-Based Production in Peninsular Malaysia," Jurnal Ekonomi Malaysia, Faculty of Economics and Business, Universiti Kebangsaan Malaysia, vol. 51(2), pages 143-154.
    7. Georgios Bertsatos & Plutarchos Sakellaris & Mike G. Tsionas, 2022. "Extensions of the Pesaran, Shin and Smith (2001) bounds testing procedure," Empirical Economics, Springer, vol. 62(2), pages 605-634, February.
    8. Md.Yousuf & Raju Ahmed & Nasrin Akther Lubna & Shah Md. Sumon, 2019. "Estimating the Services Sector Impact on Economic Growth of Bangladesh: An Econometric Investigation," Asian Journal of Economic Modelling, Asian Economic and Social Society, vol. 7(2), pages 62-72, June.
    9. Nasreen, Samia & Anwar, Sofia & Ozturk, Ilhan, 2017. "Financial stability, energy consumption and environmental quality: Evidence from South Asian economies," Renewable and Sustainable Energy Reviews, Elsevier, vol. 67(C), pages 1105-1122.
    10. Muhammad Shafiullah & Ravinthirakumaran Navaratnam, 2016. "Do Bangladesh and Sri Lanka Enjoy Export-Led Growth? A Comparison of Two Small South Asian Economies," South Asia Economic Journal, Institute of Policy Studies of Sri Lanka, vol. 17(1), pages 114-132, March.
    11. Shuyang Chen, 2021. "The Urbanisation Impacts on the Policy Effects of the Carbon Tax in China," Sustainability, MDPI, vol. 13(12), pages 1-11, June.
    12. Boukraine, Wissem, 2020. "The finance-inequality nexus in the BRICS countries: evidence from an ARDL bound testing approach," MPRA Paper 101976, University Library of Munich, Germany.
    13. Garrod Brian & Almeida António & Machado Luiz, 2023. "Modelling of nonlinear asymmetric effects of changes in tourism on economic growth in an autonomous small-island economy," European Journal of Tourism, Hospitality and Recreation, Sciendo, vol. 13(2), pages 154-172, December.
    14. Ngoo Yee Ting & Loi Siew Ling, 2011. "Okun’S Law In Malaysia: An Autoregressive Distributed Lag (Ardl) Approach With Hodrick-Prescott (Hp) Filter," Journal of Global Business and Economics, Global Research Agency, vol. 2(1), pages 95-103, January.
    15. Zheng, Li & Abbasi, Kashif Raza & Salem, Sultan & Irfan, Muhammad & Alvarado, Rafael & Lv, Kangjuan, 2022. "How technological innovation and institutional quality affect sectoral energy consumption in Pakistan? Fresh policy insights from novel econometric approach," Technological Forecasting and Social Change, Elsevier, vol. 183(C).
    16. Muhammad Shahbaz & Vassilios G. Papavassiliou & Amine Lahiani & David Roubaud, 2023. "Are we moving towards decarbonisation of the global economy? Lessons from the distant past to the present," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 28(3), pages 2620-2634, July.
    17. Birendra Bahadur Budha, 2013. "Demand for Money in Nepal: An ARDL Bounds Testing Approach," NRB Economic Review, Nepal Rastra Bank, Economic Research Department, vol. 25(1), pages 21-36, April.
    18. Egbichi Comfort & Abuh Ojamaliya & Okafor Victoria & Godwin Abigail & Adedoyin Oluwapelumi, 2018. "Dynamic Impact of Energy Consumption on the Growth of Nigeria Economy (1986-2016): Evidence from Symmetrical Autoregressive Distributed Lag Model," International Journal of Energy Economics and Policy, Econjournals, vol. 8(2), pages 188-195.
    19. Ghosh, Soumya Kanti & Nath, Hiranya K., 2023. "What determines private and household savings in India?," International Review of Economics & Finance, Elsevier, vol. 86(C), pages 639-651.
    20. Obsatar Sinaga & Mohd Haizam Mohd Saudi & Djoko Roespinoedji & Mohd Shahril Ahmad Razimi, 2019. "The Dynamic Relationship between Natural Gas and Economic Growth: Evidence from Indonesia," International Journal of Energy Economics and Policy, Econjournals, vol. 9(3), pages 388-394.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ani:irdjoe:v:4:y:2022:i:3:p:394-399. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Dr. Muhammad Abrar ul Haq (email available below). General contact details of provider: https://journals.internationalrasd.org/index.php/joe/index .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.