Do Imports and Foreign Capital Inflows Lead Economic Growth? Cointegration and Causality Analysis in Pakistan
AbstractThe paper investigates the effects of imports and foreign capital inflows on economic growth in case of Pakistan over the period of 1990Q1-2008Q4. We have applied ARDL bounds testing approach to examine the long run relationship and investigated the direction of causality by using VECM multivariate framework. Our analysis confirms the long run relationship between imports, foreign capital inflows and economic growth. The results show that imports and foreign capital inflows have positive and significant effect on the economic growth of Pakistan. Causality analysis reveals bidirectional causal association among the variables, but strong causality is found from imports and foreign capital inflows to real GDP.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 29805.
Date of creation: 22 Mar 2011
Date of revision: 24 Mar 2011
Imports; FDI; Growth; Pakistan;
Other versions of this item:
- Mohammad Mafizur Rahman & Muhammad Shahbaz, 2013. "Do Imports and Foreign Capital Inflows Lead Economic Growth? Cointegration and Causality Analysis in Pakistan," South Asia Economic Journal, Institute of Policy Studies of Sri Lanka, vol. 14(1), pages 59-81, March.
- A1 - General Economics and Teaching - - General Economics
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-04-09 (All new papers)
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