Impact of macroeconomic factors on development of Paki-stan

Ifran Khan,Faryal Faryal,Muhammad Rizwan Nazir,Zeeshan Fareed,Muhammad Imran Nazir

doi:10.14419/ijaes.v5i1.7538

Abstract

Macroeconomic factors play a fundamental role in attracting the growth the country. This research examined the impact of various macroeconomic factors on GDP of Pakistan for the period of 1975-2015. The core objective of this research was to check the impact of inflation, investment, exchange rate and net export on development of Pakistan. The tool for analysis was Ordinary Least Square (OLS) multiple regression model. This research used Descriptive Statistics, Harvey's test for checking the heteroscedasticity and Breusch Godfrey LM test to check autocorrelation among variables. The results of this study show that inflation exerts negative significant effect on Pakistan GDP whereas investment shows positive significant effect and exchange rate have positive insignificant effect on GDP of Pakistan. Moreover net export has been highly positive significant on Pakistan GDP.

Highlights

Throughout the years, the week and decreasing trend in economic development in Pakistan is troubling for Policy makers, experts, and foreign aid donor agencies
Some macroeconomic variables influence the Gross Domestic Product (GDP) of any nation as Pakistan GDP rely on numerous macroeconomic components here we just examine some main factors like inflation, investment, exchange rate and net export
Pakistan's economic growth has stayed unsustainable to an alarming situation, which has serious apprehension for policy makers, experts, and foreign donor agencies

Summary

Introduction

Throughout the years, the week and decreasing trend in economic development in Pakistan is troubling for Policy makers, experts, and foreign aid donor agencies. Some macroeconomic variables influence the GDP of any nation as Pakistan GDP rely on numerous macroeconomic components here we just examine some main factors like inflation, investment, exchange rate and net export. During the years of 1951-52, five primary products added to the tune of 93% of exports profit and by 1958-59 that had tumbled to 75% All these macroeconomic variables like Inflation, Investment, Net exports and Exchange rate exceedingly influence to Pakistan development. These variables assume an essential part toward Gross Domestic Product (GDP) of any nation. In this study we have analyzed the impact of Inflation, investment, net export and exchange rate on GDP of Pakistan

Objectives

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Conclusion