Abstract
The modern logistics industry has opened new strategic perspectives in establishing its interrelation with economic growth. In recent years, understanding such an overlap has become a policy issue considering ever-increasing factors and their influence on this relation. Most existing studies have explored this interaction from a general perspective, or for developed countries. This paper explores time-series analysis of the dynamic variables and their inter-related influence in both the short and long run on the relationship between modern logistic industry and economic growth—a more specific perspective, particularly for developing countries. Accordingly, we exemplify our analysis by employing the vector autoregression (VAR) model to the most updated time series data of investment in the logistics industry and the economic growth of Pakistan from 1990 to 2018. The empirical findings endorse the previous studies’ outcomes and recognize the importance of sustainable economic development concerning continuously improving the logistics industry. However, a unidirectional relation is observed that economic growth leads to developing the logistics industry—economic growth exerts a significant demand-pull effect on Pakistan’s logistics. It implies that logistic industrial development is comparatively quicker in the geographical areas where economic growth is higher than those areas where economic growth is low. To conclude this study’s findings, logistics industry reforms should prioritize the selected geographical areas in improving the economy that would lead to the modern logistics industry’s development. As the model adopts Pakistan’s context, the overall statistical analysis can be generalized to other developing economies. These results would be of particular interest to strategy makers working in developing countries and help them design and develop modern transportation and logistics, coupled with interlinked technological factors, which would attract investment in the logistics industry for sustainable economic development.
Highlights
Academic Editor: Long Truong e modern logistics industry has opened new strategic perspectives in establishing its interrelation with economic growth
Most existing studies have explored this interaction from a general perspective, or for developed countries. is paper explores time-series analysis of the dynamic variables and their inter-related influence in both the short and long run on the relationship between modern logistic industry and economic growth—a more specific perspective, for developing countries
We exemplify our analysis by employing the vector autoregression (VAR) model to the most updated time series data of investment in the logistics industry and the economic growth of Pakistan from 1990 to 2018. e empirical findings endorse the previous studies’ outcomes and recognize the importance of sustainable economic development concerning continuously improving the logistics industry
Summary
A Correlative Analysis of Modern Logistics Industry to Developing Economy Using the VAR Model: A Case of Pakistan. Is paper explores time-series analysis of the dynamic variables and their inter-related influence in both the short and long run on the relationship between modern logistic industry and economic growth—a more specific perspective, for developing countries. A large sample size is required to study the population to follow certain distinctive probability distributions Given these points, existing literature has a substantial research gap concerning the correlation between the modern logistics industry and the national economy, from developing countries’ aspect. We employed an econometric model to investigate short- and long-run relationships between the modern logistics industry and economic growth This relationship is explored from a quantitative perspective to achieve a visual and convincing impact [2].
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