Trade Openness, External Debt and Growth Nexus in Pakistan: Empirical Evidence from ARDL Modeling Approach & Co-Integration Causality Analysis

Authors

  • Hina Ali Assistant Professor, Department of Economics, The Women University Multan Pakistan
  • Fatima Farooq Assistant Professor, School of Economics Bahauddin Zakariya University Multan, Pakistan
  • Najma Mumtaz M.Phil Scholar, Department of Economics, The Women University Multan, Pakistan

DOI:

https://doi.org/10.26710/reads.v2i2.127

Keywords:

External Debt, Capital Formation, Foreign direct Investment, Trade Openness, Economic growth

Abstract

This Empirical study Explores the Influence of trade openness and
external debt on economic growth by using time series data from 1974 -
2016. Gross domestic Product (GDP) as dependent variable while
Foreign Direct Investment, Inflation, External debt, Capital formation
and Trade as explanatory variable are used. Unit Root Test applies to
check the stationary of data in which GDP & INF are integrate at level
1(0) while the channel of variables like FDI, T, ED, CF are integrate at
1stdifference. Auto-regressive distributed lagged model (ARDL)
technique applies for estimation. The study finds out the relation between
channels of variable that how these variables are interrelated. The
findings indicate that External debt and capital formation has Inverse
influence on Economic growth while Trade Openness, Inflation, foreign
Direct Investment has positive impact on economic growth.

References

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Published

2020-07-25

How to Cite

Hina Ali, Fatima Farooq, & Najma Mumtaz. (2020). Trade Openness, External Debt and Growth Nexus in Pakistan: Empirical Evidence from ARDL Modeling Approach & Co-Integration Causality Analysis. Review of Economics and Development Studies, 2(2), 93-102. https://doi.org/10.26710/reads.v2i2.127

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