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Fiscal, Monetary Policies and Institutions’ Role (Political, Social and Economic) in Pakistan


  • Tariq HUSSAIN

    (Government College University, Lahore, Pakistan)

  • Muhammad Wasif SIDDIQI

    (Government College University, Lahore, Pakistan)


The purpose of this study is to test the fundamental relationship between fiscal, monetary policies and institutions in Pakistan from 1976 to 2008. These policies are roadmap in the progress of a country. No doubt both these policies are useful tools in the hands of the government to increase the per capita GDP of the country. Such policies depict the performance level of institutions of a country. Better institutions leads to higher level of growth. Institutions perform significant role in the progress of any country. The growth targets can be achieved through institutions. Higher the quality of institutions, higher the performance would be shown by economy. Countries can reach middle-income levels despite some corruption, but further growth requires much better institutions (Easterly, 2001, pp. 234-235, 245-248, Rodrik, 2003, pp. 16-17). Kwiatkowski et al (1992) test is used to test unit root and short run relationship is analyzed through ECM. Auto regressive distributed lags (ARDL) shows that there is long run relationship among growth policies and institutions’ role in Pakistan.

Suggested Citation

  • Tariq HUSSAIN & Muhammad Wasif SIDDIQI, 2012. "Fiscal, Monetary Policies and Institutions’ Role (Political, Social and Economic) in Pakistan," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania - AGER, vol. 0(6(571)), pages 33-50, June.
  • Handle: RePEc:agr:journl:v:6(571):y:2012:i:6(571):p:33-50

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    fiscal policy; monetary policy; institutions.;


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