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Export Diversification and Growth in Pakistan: An Empirical Investigation from 1972 to 2015

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  • Aamir Hussain Siddiqui

    (Institute of Business Management, Karachi)

Abstract

This paper addresses three issues (a) it attempts to estimate whether product and geographical export diversification has contributed to GDP growth during the 1972-2015 period, (b) identify the determinants of export diversification during this period and (c) ascertain whether a structural break in the export diversification-GDP growth relationship has occurred after 2000, since when policy of liberalization has been pursued. We find a significant though modest positive association between export diversification and GDP growth during 1972-2015 and some evidence that this relationship though remaining statistically significant, however, it somewhat weakened during the liberalization period 2000-2015. We also find that private sector credit and human capital growth and favorable movements in Pakistan’s aggregate terms of trade are negatively associated with product export diversification. Export diversification is currently a policy priority; however, the government’s emphasis has been geographical – not product – export diversification. Our estimations show no positive significant relationship between geographical export diversification and GDP growth. We therefore suggest that incentives should be provided to induce Pakistani exporters to attempt to penetrate global value chain in product areas in which they already have a presence by linking their business strategies to carefully selected leading global market players.

Suggested Citation

  • Aamir Hussain Siddiqui, 2018. "Export Diversification and Growth in Pakistan: An Empirical Investigation from 1972 to 2015," Business & Economic Review, Institute of Management Sciences, Peshawar, Pakistan, vol. 10(1), pages 107-132, March.
    • Handle: RePEc:bec:imsber:v:10:y:2018:i:1:p:107-132
    DOI: dx.doi.org/10.22547/BER/10.1.5
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    Cited by:

    1. Aamir Hussain Siddiqui, 2020. "Analysis of Pakistan Trade Policies in the Context of Export Diversification," Journal of Finance and Economics Research, Geist Science, Iqra University, Faculty of Business Administration, vol. 5(1), pages 59-76, March.
    2. Dahmani, Mounir, 2021. "Impact de la diversification des exportations sur la croissance économique: Cas de la Tunisie [Impact of export diversification on economic growth: case of Tunisia]," MPRA Paper 112225, University Library of Munich, Germany, revised 2021.
    3. Amir Azam, 2020. "The Impact of Industrial Policy on Export Diversification: Some Empirical Evidences from Pakistan," Technium Social Sciences Journal, Technium Science, vol. 5(1), pages 84-96, March.
    4. repec:thr:techub:1005:y:2020:i:1:p:84-96 is not listed on IDEAS

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    More about this item

    Keywords

    Export diversification; GDP; Pakistan; Co-integration regression; export policy;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F15 - International Economics - - Trade - - - Economic Integration
    • F19 - International Economics - - Trade - - - Other

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