Effects of Terms of Trade on Economic Growth of Pakistan

Khalil Jebran, Amjad Iqbal, Zia Ur Rehman Rao and Arshad Ali

Foreign Trade Review, 2018, vol. 53, issue 1, 1-11

Abstract: This paper analyzes the effect of terms of trade on economic growth of Pakistan considering annual time series data from 1980 to 2013. This study opted autoregressive distributed lag model for purpose of analyzing short- and long-run relationship. The results reveal significant negative long-run and short-run effects of terms of trade on economic growth. The analyses also indicate significant positive long-run and short-run effects of labour on economic growth. Further, capital stock is influencing positively the economic growth in long run only. We suggest that economic policies may be implemented to deteriorate terms of trade which will further enhance the economic growth of Pakistan. JEL: F13, F43

Keywords: Economic growth; terms of trade; ARDL; Pakistan (search for similar items in EconPapers)
Date: 2018
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Persistent link: https://EconPapers.repec.org/RePEc:sae:fortra:v:53:y:2018:i:1:p:1-11

DOI: 10.1177/0015732516663315

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