The RBC View of Pakistan: A Declaration of Stylized Facts and Essential Models

Ali Choudhary and Farooq Pasha

No 56, SBP Working Paper Series from State Bank of Pakistan, Research Department

Abstract: In this paper, we establish the nature of short-run fluctuations of the Pakistani economy over the period of 1981-2010. There have been significant changes in the nature of the Pakistani economy over the last few decades. Therefore, we focus our detailed analysis on the last few decades where it seems more appropriate to investigate the nature and causes of business cycles in Pakistan. Furthermore, we evaluate the performance of a typical RBC and an augmented RBC model with an exogenous FDI shock in explaining cyclical fluctuations experienced by the Pakistani economy. We find that a simple RBC model performs poorly in terms of matching relevant second order moments of short run fluctuations as depicted by the data. However, augmented RBC model performs better compared to the simple RBC model.

Keywords: Business cycles; emerging economies; FDI (search for similar items in EconPapers)
JEL-codes: E32 (search for similar items in EconPapers)
Pages: 71 pages
Date: 2013-03
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

Downloads: (external link)
http://www.sbp.org.pk/repec/sbp/wpaper/wp56.pdf First version, 2013 (application/pdf)
Our link check indicates that this URL is bad, the error code is: 404 Not Found (http://www.sbp.org.pk/repec/sbp/wpaper/wp56.pdf [301 Moved Permanently]--> https://www.sbp.org.pk/repec/sbp/wpaper/wp56.pdf)

Related works:
Working Paper: The RBC View of Pakistan: A Declaration of Stylized Facts and Essential Models (2013)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:sbp:wpaper:56

Access Statistics for this paper

More papers in SBP Working Paper Series from State Bank of Pakistan, Research Department Contact information at EDIRC.
Bibliographic data for series maintained by Faisal Saleem ().