IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this article or follow this journal

Macroeconomic Determinants of Economic Growth in Pakistan

  • Zafar Iqbal

    (Pakistan Institute of Development Economics, Islamabad.)

  • Ghulam Mustafa Zahid

    (Pakistan Institute of Development Economics, Islamabad.)

Registered author(s):

    The main purpose of this paper has been to examine the effects of some of the key macroeconomic variables on Pakistan’s economic growth. Multiple regression framework is used to separate out the effects of key macroeconomic factors on growth over the period 1959-60 to 1996-97. The quantitative evidence shows that primary education to be an important prerequisite for accelerating growth. Similarly, increasing the stock of physical capital would help to contribute to growth. The empirical results also suggest that openness of Pakistan’s economy promotes economic growth. Alternatively, the budget deficit is negatively related to both output growth variables. The external debt is also negatively related to growth, suggesting that relying on domestic resources is the best alternative to finance growth. However, the results presented in this study reinforce the importance of sensible long-run growth-oriented policies to obtain sustainable growth.

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

    File URL: http://www.pide.org.pk/pdf/PDR/1998/Volume2/125-148.pdf
    Download Restriction: no

    Article provided by Pakistan Institute of Development Economics in its journal The Pakistan Development Review.

    Volume (Year): 37 (1998)
    Issue (Month): 2 ()
    Pages: 125-148

    as
    in new window

    Handle: RePEc:pid:journl:v:37:y:1998:i:2:p:125-148
    Contact details of provider: Postal: P.O.Box 1091, Islamabad-44000
    Phone: (92)(51)9248051
    Fax: (92)(51)9248065
    Web page: http://www.pide.org.pk
    Email:


    More information through EDIRC

    References listed on IDEAS
    Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

    as in new window
    1. Taylor, Lance, 1994. "Gap models," Journal of Development Economics, Elsevier, vol. 45(1), pages 17-34, October.
    2. Weisskopf, Thomas E., 1972. "The impact of foreign capital inflow on domestic savings in underdeveloped countries," Journal of International Economics, Elsevier, vol. 2(1), pages 25-38, February.
    3. Barro, R.J., 1988. "Government Spending In A Simple Model Of Endogenous Growth," RCER Working Papers 130, University of Rochester - Center for Economic Research (RCER).
    4. Nancy Birdsall & David Ross & Richard Sabot, 1993. "Underinvestment in Education: How Much Growth has Pakistan Foregone?," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 32(4), pages 453-499.
    5. Reinhart, Carmen & Khan, Mohsin, 1989. "Private investment and economic growth in developing countries," MPRA Paper 13655, University Library of Munich, Germany.
    6. Richard R. Nelson & Edmond S. Phelps, 1965. "Investment in Humans, Technological Diffusion and Economic Growth," Cowles Foundation Discussion Papers 189, Cowles Foundation for Research in Economics, Yale University.
    7. Robert J. Barro, 1989. "Economic Growth in a Cross Section of Countries," NBER Working Papers 3120, National Bureau of Economic Research, Inc.
    8. Zafar Iqbal, 1995. "Constraints to the Economic Growth of Pakistan: A Three-gap Approach," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 34(4), pages 1119-1133.
    9. N. Gregory Mankiw & David Romer & David N. Weil, 1990. "A Contribution to the Empirics of Economic Growth," NBER Working Papers 3541, National Bureau of Economic Research, Inc.
    10. Bacha, Edmar L., 1990. "A three-gap model of foreign transfers and the GDP growth rate in developing countries," Journal of Development Economics, Elsevier, vol. 32(2), pages 279-296, April.
    11. Mosley, Paul, 1980. "Aid, Savings and Growth Revisited," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 42(2), pages 79-95, May.
    12. Benhabib, Jess & Spiegel, Mark M., 1994. "The role of human capital in economic development evidence from aggregate cross-country data," Journal of Monetary Economics, Elsevier, vol. 34(2), pages 143-173, October.
    13. William Easterly & Sergio Rebelo, 1993. "Fiscal Policy and Economic Growth: An Empirical Investigation," NBER Working Papers 4499, National Bureau of Economic Research, Inc.
    14. Griffin, Keith B & Enos, J L, 1970. "Foreign Assistance: Objectives and Consequences," Economic Development and Cultural Change, University of Chicago Press, vol. 18(3), pages 313-27, April.
    15. Zafar Iqbal, 1993. "Institutional Variations in Saving Behaviour in Pakistan," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 32(4), pages 1293-1311.
    16. Hasan, Lubna, 1992. "Dependency Ratio, Foreign Capital Inflows and the Rate of Savings in Pakistan," MPRA Paper 7342, University Library of Munich, Germany.
    17. Solimano, Andres, 1990. "Macroeconomic constraints for medium term growth and distribution : a model for Chile," Policy Research Working Paper Series 400, The World Bank.
    18. Kevin M. Murphy & Andrei Shleifer & Robert W. Vishny, 1990. "The Allocation of Talent: Implications for Growth," NBER Working Papers 3530, National Bureau of Economic Research, Inc.
    19. Easterly, William & Kremer, Michael & Pritchett, Lant & Summers, Lawrence H., 1993. "Good policy or good luck?: Country growth performance and temporary shocks," Journal of Monetary Economics, Elsevier, vol. 32(3), pages 459-483, December.
    20. Easterly, William, 1993. "How much do distortions affect growth?," Journal of Monetary Economics, Elsevier, vol. 32(2), pages 187-212, November.
    21. Paul M Romer, 1999. "Increasing Returns and Long-Run Growth," Levine's Working Paper Archive 2232, David K. Levine.
    22. Borensztein, Eduardo, 1990. "Debt overhang, credit rationing and investment," Journal of Development Economics, Elsevier, vol. 32(2), pages 315-335, April.
    23. Hicks, Norman L., 1979. "Growth vs basic needs: Is there a trade-off?," World Development, Elsevier, vol. 7(11-12), pages 985-994.
    24. Nasir M. Khilji & Akhtar Mahmood, 1997. "Military Expenditures and Economic Growth in Pakistan," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 36(4), pages 791-808.
    25. Khan, Ashfaque H. & Hasan, Lubna & Malik, Afia, 1994. "Determinants of National Saving Rate in Pakistan," Economia Internazionale / International Economics, Camera di Commercio di Genova, vol. 47(4), pages 365-382.
    26. Bruton, Henry J, 1969. "The Two Gap Approach to Aid and Development: Comment," American Economic Review, American Economic Association, vol. 59(3), pages 439-46, June.
    27. Khan, Ashfaque H. & Iqbal, Zafar, 1991. "Fiscal Deficit and Private Sector Activities in Pakistan," Economia Internazionale / International Economics, Camera di Commercio di Genova, vol. 44(2-3), pages 182-190.
    28. Kormendi, Roger C. & Meguire, Philip G., 1985. "Macroeconomic determinants of growth: Cross-country evidence," Journal of Monetary Economics, Elsevier, vol. 16(2), pages 141-163, September.
    29. Lucas, Robert Jr., 1988. "On the mechanics of economic development," Journal of Monetary Economics, Elsevier, vol. 22(1), pages 3-42, July.
    30. Weisskopf, Thomas E, 1972. "An Econometric Test of Alternative Constraints on the Growth of Underdeveloped Countries," The Review of Economics and Statistics, MIT Press, vol. 54(1), pages 67-78, February.
    31. Elias, Victor Jorge, 1978. "Sources of Economic Growth in Latin American Countries," The Review of Economics and Statistics, MIT Press, vol. 60(3), pages 362-70, August.
    32. Ram, Rati, 1987. "Exports and Economic Growth in Developing Countries: Evidence from Time-Series and Cross-Section Data," Economic Development and Cultural Change, University of Chicago Press, vol. 36(1), pages 51-72, October.
    33. Zafar Iqbal, 1994. "Macroeconomic Effects of Adjustment Lending in Pakistan," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 33(4), pages 1011-1031.
    34. Pritchett, Lant, 1996. "Where has all the education gone?," Policy Research Working Paper Series 1581, The World Bank.
    Full references (including those not matched with items on IDEAS)

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    When requesting a correction, please mention this item's handle: RePEc:pid:journl:v:37:y:1998:i:2:p:125-148. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Khurram Iqbal)

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.