The impact of financial openness, trade openness on macroeconomic volatility in Pakistan: ARDL Co Integration approach

Hira Mujahid and Shaista Alam
Authors registered in the RePEc Author Service: Dr.Hira Mujajhid

MPRA Paper from University Library of Munich, Germany

Abstract: The purpose of this paper is to investigate the relationship between trade openness, financial openness, and macroeconomic volatility in Pakistan. For this purpose, time-series data from 1970-to 2010 and the ARDL cointegration technique were used to find the long-run relationship. The results proposed that in the long run, trade openness generates volatility in output and investment, whereas financial openness has a significant effect only on investment volatilities. Furthermore, the error correction model suggested that in the short run, trade and financial openness significantly affect output, consumption, and investment volatilities.

Keywords: Macroeconomic Volatility; Trade openness; financial openness; Consumption; Investment (search for similar items in EconPapers)
JEL-codes: E21 F41 F62 (search for similar items in EconPapers)
Date: 2014-01
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Published in E3 Journal of Business Management and Economics 1.5(2014): pp. 001-008

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Journal Article: The impact of financial openness, trade openness on macroeconomic volatility in Pakistan: ARDL Co Integration approach (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:113234

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