The Effect of Exports on Gdp Growth in Pakistan
The effect of Exports on GDP Growth in Pakistan
Abstract:
This paper is examines the causal relationships between gross domestic product (GDP) and exports in Pakistan by using time series data for the period between 1980 and 2000. Time series evidence shows that increase in exports has a significant effect on the economic growth of Pakistan in the previous two decades. This paper uses cointegration to check the causal relationship between export growth and economic growth in Pakistan. Granger Causality test shows that there is uni-directional causality between exports and economics growth in which running from exports to economic growth, it shows that there is long term relationship between exports and the economic growth. ADF and DF test are use to check the stationarity of the time series data.
1. Introduction:
The relationship between export and GDP growth has importance in both theoretical and empirical literature. The early analysis on this relationship examined the correlation coefficient between exports and GDP growth. According to these studies the export expansion and economic growth are positively correlated. Recent studies have emphasis on causality between export expansion and economic growth.
This paper attempts to provide analysis of export-led growth hypothesis for the case of Pakistan. Export-led growth is an economic strategy used by some developing countries. Export-led growth is important because it can create profit and it allowing the country to balance their finance.
The most common ways are to attain export-led growth by the exports of the manufactured goods and the exports of raw materials. Today, due to the global economic crisis, many countries are rightly worried about the benefits of a growth process built on export-led growth.
This paper proceeds as follows.
The relationship between export and economic growth has been examined during the last two decades. The competition in exports may create the exploitation of
Abstract:
This paper is examines the causal relationships between gross domestic product (GDP) and exports in Pakistan by using time series data for the period between 1980 and 2000. Time series evidence shows that increase in exports has a significant effect on the economic growth of Pakistan in the previous two decades. This paper uses cointegration to check the causal relationship between export growth and economic growth in Pakistan. Granger Causality test shows that there is uni-directional causality between exports and economics growth in which running from exports to economic growth, it shows that there is long term relationship between exports and the economic growth. ADF and DF test are use to check the stationarity of the time series data.
1. Introduction:
The relationship between export and GDP growth has importance in both theoretical and empirical literature. The early analysis on this relationship examined the correlation coefficient between exports and GDP growth. According to these studies the export expansion and economic growth are positively correlated. Recent studies have emphasis on causality between export expansion and economic growth.
This paper attempts to provide analysis of export-led growth hypothesis for the case of Pakistan. Export-led growth is an economic strategy used by some developing countries. Export-led growth is important because it can create profit and it allowing the country to balance their finance.
The most common ways are to attain export-led growth by the exports of the manufactured goods and the exports of raw materials. Today, due to the global economic crisis, many countries are rightly worried about the benefits of a growth process built on export-led growth.
This paper proceeds as follows.
The relationship between export and economic growth has been examined during the last two decades. The competition in exports may create the exploitation of
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