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Poverty, inflation and economic growth: empirical evidence from Pakistan

Author

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  • Chani, Muhammad Irfan
  • Pervaiz, Zahid
  • Jan, Sajjad Ahmad
  • Ali, Amjad
  • Chaudhary, Amatul R.

Abstract

This study aims to investigate the role of economic growth and inflation in explaining the prevalence of poverty in Pakistan. ARDL bound testing approach to co-integration confirms the existence of long run relationship among the variables of poverty, economic growth, inflation, investment and trade openness over the period of 1972-2008. Empirical results show that economic growth and investment have negative and inflation has positive impact on poverty. The effect of trade openness on poverty is insignificant in this study. The short run analysis reveals that economic growth has negative and inflation has positive impact on poverty whereas the role of investment and trade openness in poverty reduction in short run is not significant.

Suggested Citation

  • Chani, Muhammad Irfan & Pervaiz, Zahid & Jan, Sajjad Ahmad & Ali, Amjad & Chaudhary, Amatul R., 2011. "Poverty, inflation and economic growth: empirical evidence from Pakistan," MPRA Paper 34290, University Library of Munich, Germany, revised 2011.
    • Handle: RePEc:pra:mprapa:34290
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    References listed on IDEAS

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    2. Pierre‐Richard Agénor, 2005. "The Macroeconomics Of Poverty Reduction," Manchester School, University of Manchester, vol. 73(4), pages 369-434, July.
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    More about this item

    Keywords

    Poverty; Inflation; Economic Grovvth; Pakistan; Macroeconomic Policy; Welfare; Trade Openness;
    All these keywords.

    JEL classification:

    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
    • C01 - Mathematical and Quantitative Methods - - General - - - Econometrics
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty

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