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Population Growth and Economic Development: Test for Causality

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  • Khalid Mushtaq

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    (Assistant Professor in the Department of Agricultural Economics, University of Agriculture, Faisalabad, Pakistan.)

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    Abstract

    This paper examines the existenceof a long-run relationship between population and per capita income in Pakistan for the period 1960-2001 using cointegration analysis. Unit root results show that population is integrated of order zero while per capita income is integrated of order one; further, Johansen’s procedure showthat no long-run cointegrating relationship exists. Thus, population growth neither causes per capita income growth nor is caused by it. A corollary is that population growth neither stimulates per capita income growth nor reduces it.

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    File URL: http://121.52.153.179/JOURNAL/Vol-11NoII/Khalid%20Mushtaq.pdf
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    Bibliographic Info

    Article provided by Department of Economics, The Lahore School of Economics in its journal Lahore Journal of Economics.

    Volume (Year): 11 (2006)
    Issue (Month): 2 (Jul-Dec)
    Pages: 71-77

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    Handle: RePEc:lje:journl:v:11:y:2006:i:2:p:71-77

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    Web page: http://www.lahoreschoolofeconomics.edu.pk/EconomicsJournal/LJEIntro.aspx
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    1. Christopher A. Sims, 1988. "Bayesian skepticism on unit root econometrics," Discussion Paper / Institute for Empirical Macroeconomics 3, Federal Reserve Bank of Minneapolis.
    2. Kelley, Allen C, 1988. "Economic Consequences of Population Change in the Third World," Journal of Economic Literature, American Economic Association, vol. 26(4), pages 1685-1728, December.
    3. Dickey, David A & Fuller, Wayne A, 1981. "Likelihood Ratio Statistics for Autoregressive Time Series with a Unit Root," Econometrica, Econometric Society, vol. 49(4), pages 1057-72, June.
    4. Thirlwall, A P, 1972. "A Cross Section Study of Population Growth and the Growth of Output and Per Capita Income in a Production Function Framework," The Manchester School of Economic & Social Studies, University of Manchester, vol. 40(4), pages 339-56, December.
    5. Dickey, David A & Pantula, Sastry G, 1987. "Determining the Ordering of Differencing in Autoregressive Processes," Journal of Business & Economic Statistics, American Statistical Association, vol. 5(4), pages 455-61, October.
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