DETERMINANTS OF ECONOMIC GROWTH IN PAKISTAN: A STRUCTURAL VECTOR AUTO REGRESSION (SVAR) ANALYSIS

Muhammad Ajmair (), Khadim Hussain (), Faisal Abbassi () and Zahra Bhutta ()
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Muhammad Ajmair: Mirpur University of Science and Technology
Khadim Hussain: Mirpur University of Science and Technology
Zahra Bhutta: National University of Modern Language

European Journal of Business and Economics, 2017, vol. 12, issue 2, 1116 volume1: 12

Abstract: The study follows Structural Vector Auto Regression (SVAR) approach proposed by the so-called AB-model of Amisano and Giannini (1997) to find out relevant macroeconomic determinants of economic growth in Pakistan. Annual data is taken from World Development Indicators (CD-ROM, 2015) for the period 1976-2014. The widely-used Schwarz information criterion and Akaike information criterion is considered for the lag length in each estimated equation. Main findings of the study are that remittances received, gross national expenditures and inflation are found to be the best relevant positive and significant determinants of economic growth. Based on these empirical findings, we conclude that government should focus on overall economic growth augmenting factors while formulating any policy relevant to the concerned sector.

Keywords: Structural VarRemittances; Economic Growth; Grass National Expenditures; Inflation (search for similar items in EconPapers)
JEL-codes: C82 E22 F24 F43 (search for similar items in EconPapers)
Date: 2017
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Persistent link: https://EconPapers.repec.org/RePEc:aad:ejbejj:v:12:y:2017:i:2:p:1116

DOI: 10.12955/ejbe.v12i2.1116

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