Impact of Trade liberalization on Economic growth of Pakistan

日期 : Oct 2017 - Jun 2018

This research paper investigates the impact of trade openness on the economic growth. There is the mix of results suggested by the literature because it is more related to area specific. Like it is having positive impact in the case of developed countries and negative impact in case of developing counties. In addition to this there are some other development indicators are used in this study as the proxy of economic development i-e: foreign direct investment, population growth, inflation and gross fixed capital formation. The proxy of economic development is GDP per ca-pita used. The data is sourced from the World Bank ‘World Development Indicators’ and it is based on the secondary data. For getting results the STATA 12.0 software is used. The paper includes the results of descriptive statistics, correlation matrix, regression analysis results, unit root test (Augmented Dicky Fuller), vector autoregressive model and varstable test. After that the results are compared with the previous studies and draw conclusion. The results of this paper are consistent with the results of previous studies that is the trade openness is having negative and significant impact on the economic development in case of developing countries, population growth is also having significant negative impact and the gross fixed capital formation is having positive significant impact.