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The Role of Commercial Banks in Determining the Industrial Productivity in Pakistan:A Time Series Analysis

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  • Fiaz Ahmad Sulehri

    (School of Accountancy and Finance, City Campus, University of Lahore.)

  • Muhammad Zahid Naeem

    (Department of Economics, University of the Punjab, Lahore.)

Abstract

Industrial productivity is an important source of overall industrial growth. This paper has examined the role of commercial banks in determining the industrial productivity in the case of Pakistan. Partial productivity or total factor Productivity will be taken as a dependent variable and the impact of credit disbursed to industrial sector will be examined along with other institutional credits are selected as independent variables. Time series data from 1972-2015 has been obtained from Pakistan Economic Surveys and World Development Indicator to observe the long- run relationship among the variables. ADF has been applied for checking the stationary status of the data series. Diagnostic tests have been applied to examine the validity of the results. The estimated results show that commercial bank credit and labor force participation rate have a positive and significant impact on industrial productivity in the case of Pakistan. Income per capita has a negative and significant impact on industrial productivity in the case of Pakistan. So, if the government of Pakistan wants to enhance industrial productivity, it has to provide credit with skill labor force to its industrial sector.

Suggested Citation

  • Fiaz Ahmad Sulehri & Muhammad Zahid Naeem, 2018. "The Role of Commercial Banks in Determining the Industrial Productivity in Pakistan:A Time Series Analysis," Bulletin of Business and Economics (BBE), Research Foundation for Humanity (RFH), vol. 7(4), pages 185-196, December.
    • Handle: RePEc:rfh:bbejor:v:7:y:2018:i:4:p:185-196
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    References listed on IDEAS

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    Cited by:

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    More about this item

    Keywords

    industrial production; labor force; income per capita; credit;
    All these keywords.

    JEL classification:

    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • J01 - Labor and Demographic Economics - - General - - - Labor Economics: General
    • E51 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Money Supply; Credit; Money Multipliers

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