Impact of Devaluation on GDP of Pakistan

Nooreen Mujahid () and Aniqa Zeb ()
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Nooreen Mujahid: Department of Economics, University of Karachi

International Journal of Economics and Empirical Research (IJEER), 2014, vol. 2, issue 8, 345-349

Abstract: Exchange rate plays an important role in any economy as it also exchanges all the transactions in the international market. This paper studies the relationship of exchange rate to the Gross Domestic Product of Pakistan. Time series data from 1980 to 2012 has been employed in the study. Data set has been taken from the website of UNCTAD. GDP and exchange rate are the variables in the study. Objective of the paper is to find long run integration and to check the causality between these variables. The Granger Causality test has been applied on the data to find the objective of the study. Long run relationship has been found in these variables however, causality has not been found at any lag in exchange rate and Gross Domestic product. Devaluation has been found contractionary.

Keywords: Exchange rate; Gross Domestic product; Cointegration (search for similar items in EconPapers)
JEL-codes: J20 (search for similar items in EconPapers)
Date: 2014
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Citations: View citations in EconPapers (3)

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