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Can a path to peace promote export growth? Evidence from Pakistan and its trading partners

Author

Listed:
  • Amjad Naveed

    (Aarhus University)

  • Ghulam Shabbir

    (Forman Christian College University)

  • Shabib Haider Syed

    (Minhaj University Lahore)

  • Muhammad Ashfaq

    (International University of Applied Sciences)

  • Muhammad Ali Khan

    (Forman Christian College University)

Abstract

This study has investigated the connection between peace and performance of Pakistan’s export sector. The interstates conflicts, terrorist activities and war elements disturb the industry supply chain, damage the means of transportation, and increase the security measures and regulations, which make trade more expensive. On the other hand, encouragement of the peace process lowers military conflicts, promotes diplomatic cooperation, and hence trade among the nations. The purpose of the study is to test whether domestic peace in Pakistan relative to its trading partners promotes its exports. For empirical analysis, we use panel data for Pakistan and its 26 trading partners in export over the period 2007–2018. After controlling the impacts of economic size, market size, infrastructure, and exchange rate, we found that peace in Pakistan relative to its trading partners is important to promote its export sector, which is directly linked with local industries and the wellbeing of individuals. The economic size and market size of the exporting nations relative to Pakistan also positively contributed towards the exports. The depreciation of Pakistan’s exporting countries’ currencies relative to its currency lowers the volume of exports. Besides, it is also observed that a major portion of Pakistan’s exports is routed in a specific region or few countries. Therefore, it is suggested that the government should take active measures to reduce the internal as well as external conflicts, terrorists’ attacks, and war elements to promote the volume of exports.

Suggested Citation

  • Amjad Naveed & Ghulam Shabbir & Shabib Haider Syed & Muhammad Ashfaq & Muhammad Ali Khan, 2022. "Can a path to peace promote export growth? Evidence from Pakistan and its trading partners," Quality & Quantity: International Journal of Methodology, Springer, vol. 56(5), pages 3309-3324, October.
    • Handle: RePEc:spr:qualqt:v:56:y:2022:i:5:d:10.1007_s11135-021-01272-x
    DOI: 10.1007/s11135-021-01272-x
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    More about this item

    Keywords

    Peace; Interstate conflicts; Exports; Economic size; Infrastructure; Panel data;
    All these keywords.

    JEL classification:

    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F51 - International Economics - - International Relations, National Security, and International Political Economy - - - International Conflicts; Negotiations; Sanctions
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models

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