Economy Of Pakistan Research Articles

Estimation and Causes of Informal Economy in Pakistan

This study purposes to estimate the Pakistan’s informal economy by indirect methods and estimate the causes behind the informal economy. Ordinary least square is used for estimation of causes behind the informal economy. From GDP approach, conclude that informal economy is increasing while employment approach shows decreasing informal economy. The estimated result shows tax evasion is the main reason behind the informal economy in Pakistan. In our study, particular implications of the informal economy are identified. Informal economy plays a main role in income inequality and reducing the poverty. It limits implementing the operative public policy. The government should make such policies to control the informal economy and increasing tax evasion and corruption. If government formalize the informal economy by registering them at low cost, make the registration process easier and lower the amount of taxes imposed on them, the country’s growth will be doubled.

Financial Development and Private Investment

This paper finds that financial sector growth is key to boosting private investment in Pakistan. Banks, as financial intermediaries, enhance private investment by lowering risks and supporting decision-making through strong accounting standards. A broader financial system—measured by the ratio of commercial bank assets—positively impacts private investment. Financial deepening, or increasing liquid liabilities, also plays a critical role, as a developed banking system reduces transaction costs and improves fund access. Increasing private sector credit drives investment, so aligning the credit system with Pakistan's investment needs is essential. Strengthening financial intermediaries, enforcing contracts, and managing risks are necessary steps to support Pakistan’s financial sector growth and stimulate investment.

Estimation of Informal Economy in Pakistan through Monetary Approach

This study purposes to estimate Pakistan's informal economy by monetary methods. Ordinary least square is used for estimation. From the monetary approach, we conclude that the informal economy is increasing. In our study, particular implications of the informal economy are identified and conferred to accomplish and achieve the goal of continuous growth and progression of a country. The informal economy plays a main role in income inequality and reducing poverty. It limits the implementation of the operative public policy. The government should make such policies to control the informal economy and increase tax evasion.

Socio economics impacts of CPEC on Pakistan; the dark side of the project

The China-Pakistan Economic Corridor (CPEC) is a flagship project under China's Belt and Road Initiative (BRI) with significant investments in energy projects, infrastructure development, and special economic zones. While CPEC has been praised as a game-changer for Pakistan but major concerns have been raised about its negative socio-economic impacts. This research article spreads light on a comprehensive literature review to find out these impacts and identify research gaps that the researchers have not filled yet. This paper reveals that CPEC intensifies existing socio-economic inequalities, displaces local communities, causes environmental degradation, and raises concerns about debt sustainability of Pakistan. The lack of transparency in project execution has further boosted these issues. In this paper I have examined the experiences of aboriginal communities and gendered repercussions, investigated labor rights and waged conditions, and environmental impacts. As the project is still not fully completed, new issues may arise with the completion and passage of time. By conducting the research further deep, policymakers can gain a better understanding of the potential outcomes of CPEC and develop strategies accordingly to eliminate any negative impact that can be hazardous for Pakistan's economy, environment, and society.

Regional integration and export performance of Pakistan: Empirical evidence from the Shanghai Cooperation Organization (SCO).

The study examines export impact of Pakistan's integration into Shanghai Cooperation Organization (SCO) on its export's performance. We apply Poisson Pseudo-Maximum Likelihood (PPML) on augmented gravity model to estimate trade data from the period before and after permanent membership with Shanghai Cooperation Organization in 2017. The study aims to explore changes in exports volume and analyze the key mechanism through which Shanghai Cooperation Organization promotes exports. The study assesses that after integration which key exports sector such as agriculture or manufacturing sectors are affected more significantly. The initial findings suggest that SCO integration positively affect and provide access to Central Asian markets, leading to modest but noticeable promotion in exports promotion. In heterogeneity analysis we find that exports of Pakistan are more significant with low and middle-income level countries compared to higher-income level countries. Additionally, exports in the manufacturing sector benefited more than in the agriculture sector. The significant and positive findings of mechanism analysis indicate that the belt and road (B&R) initiative and bilateral trade agreements are the key factors to enhanced exports. The overall impact remains moderated by structural changes in Pakistan economy, such as poor infrastructure, deficiency in energy sector and limited trade relations with its neighbors India and Iran. The study concludes that although the SCO integration has positively promoted exports of Pakistan however, it requires to address domestic economic constraints and capitalize more effectively the benefits of SCO membership through regional cooperation mechanism. For more potential benefits in the region SCO needs to expand B&R connectivity, encourage more trade agreements, and adopt favorable environment to attract high income countries in the organization. The study provides the base for future research in depth analysis of long-term impact of SCO integration on Pakistan exports.

Corporate Social Responsibility, Earnings Management, and Cash Holding: A Study of Non-Financial Firms in Pakistan

This study investigates the interplay between CSR practices, earning management, and cash holdings in Pakistani publicly listed companies (PLCs). Spanning the period from 2013 to 2022, the research aims to provide empirical insights into how CSR initiatives influence financial practices within the Pakistani context. Methodologically, the study employs panel unit root tests and compares Ordinary Least Squares (OLS), fixed effects, and random effects models to analyze a sample of 202 non-financial firms listed on the Pakistan Stock Exchange. The implications of these findings underscore the importance of strategic CSR integration to enhance financial transparency, mitigate agency conflicts, and foster sustainable corporate growth. Managerial implications suggest that executives should focus on enhancing board effectiveness, strengthening audit oversight, aligning managerial incentives with long-term shareholder interests, and integrating CSR initiatives into core business strategies. However, the study acknowledges several limitations. These include the sector-specific focus on non-financial firms, which may limit generalizability to other sectors within the Pakistani economy. The study's reliance on panel unit root tests and econometric models, while robust, may benefit from alternative methodological approaches and sensitivity analyses. In conclusion, while this study contributes valuable insights into the CSR practices and financial management of Pakistani PLCs, future research should explore longitudinal trends, sector-specific variations, the role of emerging technologies in integration of CSR into corporate strategies. Addressing these areas would further enhance our understanding and inform policy interventions aimed at promoting transparency, accountability, and sustainable in emerging market economies like Pakistan.

Occupational exposure assessment of heavy metals among construction workers in Rawalpindi Pakistan

Construction is one of the primary drivers of development and economic activity in Pakistan. Many activities are performed at the construction site including cement mixing, carpentry, and painting. Workers working in these activities are exposed to toxic heavy metals. Due to exposure to these heavy metals, subjects are at high risk of developing diseases mainly respiratory diseases. Human hair and nail samples of construction workers in Rawalpindi, Pakistan were collected to assess the heavy metals. Heavy metals such as Al, As, Cd, Cr, Ni, K, Pb, and Zn were analyzed in the hair and fingernails of the construction workers. To determine the level of selected heavy metals, Inductively Coupled Plasma optical emission spectrometry was used. Results revealed that Al was the highest with a mean concentration of 7.54 μg/g in all three groups. Whereas Cd was below the detection limit. Heavy metal concentration was high in hair (1.77 μg/g) in two groups including cement mixing and carpentry. However, in the carpentry group heavy metal concentration was high in nails (1.19 μg/g). Additionally, the workers of the carpentry group have higher metal concentrations when compared to the other two groups and this group was at high risk of toxic metal exposure. After the correlation analysis, the results revealed that age was significantly correlated to body burden of metals (r = 0.496, p ≤ 0.05). Moreover, some of the heavy metals in hair and nails were significantly correlated with each other. Since all groups, especially carpenters, show high levels of heavy metals, there is a need for regular monitoring of heavy metals at construction sites. Most importantly, the implementation of training programs is needed to raise awareness among construction workers.

Impact of Digital Marketing Strategies on Marketing Performance: Role of Social Media Performance and E-commerce

E-commerce utilization has turned into a part of our regular routines. Ease of access and wide range of audience has made social media an effective medium to increase the marketing performance of firms. Due to its importance, the Fast moving consumer goods and retail businesses in Pakistan have employed social/ digital media managers to manage their social media platforms like Facebook, Instagram, etc. The social media managers have designed digital marketing to increase their social media performance. This is shown by the number of followers, likes, and sharing by the target audience and prospective customers. The job and abilities of Web based business assumed a significant part in our research. At the culmination, 232 respondents’ outcomes were taken into contemplation for our data analysis by using SPSS and Hayes Process Macro. The direct relationships have significant values and all hypotheses are accepted. The research attempted to help brands, and social media managers devise better strategies to increase their market share and social media ratings. It also tried to contribute to literature for firms who are left far behind in employing the E-commerce and social media strategies framework to enhance their market performance and online transactions abilities. Additionally, our research examination adds to the current writing by offering bits of knowledge for firms that still can't seem to completely use internet business and entertainment procedures. By taking on these structures, organizations can further develop their market execution and online exchange abilities. Our review highlights the groundbreaking effect of advanced advertising on business development and client commitment.

ECONOMIC SECURITY CHALLENGES TO PAKISTAN DURING POST PANDEMIC ERA

Pakistan’s economy has faced many challenges since the inception of Pakistan as an independent state. The economy of country was largely dependent on agrarian resources during the initial decades and then industrial bases afterwards. During the past three decades it the economy of Pakistan depends on loans and financial aids from international financial institutions such as, IMF along the industrial growth. The world economy slowed down after the pandemic and it also had consequences on Pakistan economy. Covid-19 caused major disruption in Pakistan economy. As, Before pandemic the GDP growth rate was 2.50% in 2019 and it fell in negative point -1.27% during the fiscal year 2020. The economic challenges to Pakistan raised during pandemic era such as its GDP growth rate decreased in negative points, its fiscal debt increased to 12.74% in 2020 as compare to 2019. Unemployment, shut down of small businesses, increase in job displacement, fiscal deficit, decline in foreign direct investment are the few challenges to name. Therefore, the economic security of Pakistan had faced many challenges during the post pandemic era. The drastic impact of covid-19 forced government to take immediate steps to counter economic challenges. The first national security policy of Pakistan in this regard made economic indicators as a challenge and made economic security a part of national policy

The Strategic Importance of China-Pakistan Economic Corridor (CPEC) and Its Impact on Strategic Stability in South Asia

China intends to spend about $62 billion on the China-Pakistan Economic Corridor (CPEC) in the coming years as a part of the broader Belt and Road Initiative (BRI). CPEC has both geoeconomic and geostrategic implications. This is a game changer for China globally as it wants to reach the Middle East, Europe, and Africa for trade and energy supplies via a shorter and alternate route. However, for Pakistan, this project not only helps in its economic development but also ensures its security against India. This study aims to examine India’s reaction to Chinese investment in the region and its impact on strategic stability in South Asia. India fears encirclement of its territory because of China’s presence in Pakistan, the Indian Ocean, and Myanmar. At the same time, the US is concerned that China is trying to revise the status quo in which the US sits at the apex. At this moment, the interests of the US and India seem to align, and they have already entered a strategic partnership. This study is qualitative in nature and relies on primary as well as secondary data available on CPEC and strategic stability. South Asia is becoming relevant to great powers’ politics. China’s investment in Pakistan will deter India from attacking Pakistan, and India will be helped by the US to prevent China from becoming a regional hegemon.

Applying Neural Networks to Predict Ventilator Demand: A Study of Pakistan's Healthcare Sector

The distribution companies that deal with ventilators in Pakistan face challenges related to inventory control because of inadequate product shelf life, shortages, excess inventory, and unnecessary stock. This study, which focuses on Pakistani ventilator distribution companies, aims to offer a novel approach to sales estimation, avoid unnecessary stock expenditures, and stop clientele loss brought on by ventilator shortages. The results of this study will help determine key elements and standards that Pakistani distributors of ventilators might employ to boost sales. Most ventilator distribution businesses in Pakistan are independent wholesalers that purchase stock from their stores and distribute it to customers. To maximize ventilator distribution firms' sales for various products, this study examined distribution and sales data from 2019 to 2024 for many locations and dates. To create an accurate sales forecasting model for a ventilator distribution company, this research also aims to apply artificial neural networks (ANN) for effective sales prediction. An Artificial Neural Network (ANN) model was trained using a dataset from ventilator distribution businesses and the proposed model produced an accuracy of 90%, which is good for early prediction.

Judicial Activism in Pakistan and its Impacts on Tripartite Governance: Lessons from the US Constitutional Construct

The judiciary played a significant role in the evolution of democracy in Pakistan. Throughout history, the military remained at the core of politics and as an avoidable stakeholder influenced the judiciary in validating its extraconstitutional actions. However, after 2009, the judiciary emerged as exceptionally independent invalidating extraconstitutional actions and stretching its authority to take up matters else within the jurisdictional province of the other state organs, resulting in judicial overstretch. Excessive judicial activism had evident adverse impacts on the equilibrium of the state organs, imposed financial liabilities, and compromised its dignity. By employing qualitative research methodology, this article considers the judiciary as a double-edged weapon and critically examines the cases where the judiciary deviated from the international treaty obligations, leaving the fragile economy of Pakistan to a blow of penalties. Lastly, the research contributes to what Pakistan can learn from the US Constitutional construct.

DYNAMIC LINKS BETWEEN COMMODITY MARKETS & PAKISTANI SECTORAL INDICES: IMPLICATIONS FOR PORTFOLIO DIVERSIFICATION

This research aimed to examine the inter-connections among international commodities markets and sectoral indices of Pakistan over the most recent period ranging from July 19, 2016, to December 29, 2023. This time period is selected based on recent important events of global significance including COVID-19 pandemics and recent geopolitical crisis emerged due to Russia-Ukraine war in Feb, 2022. This study is utilizing Generalized Autoregressive Conditional Heteroscedasticity (GARCH) model for the deeper inquiry of interplay among the variables. The findings of the study indicate significant spillovers among variables with varying degrees of significance. The results show that various sectors of Pakistan economy showed asymmetric behavior indicating that some sectors were the risk transmitters while other were risk recipients. Moreover, volatility linkages are time-varying with heightened transmissions during turbulent periods. The results provide the significant information in reaching the desired conclusion and making decisions. The findings of study thus had important implications for investors (individual & institutional), fund managers and policy makers while devising strategies for diversification and risk mitigation in the Pakistani context especially in stressful periods.

Twin Deficit Assumptions: A Case Study of Pakistan (Cab from 2000 to 2023) and (FD from 2008 to 2024)

The aim of this article is to investigate the link between fiscal deficit and current account deficit which is the high rate of fiscal deficit budget and commonly known as twin deficit or deficits assumptions in the Pakistani economy (Khalil Mudassar, Amjad Fakher, Sajid Ali & Fozia Sarwar 2013); present economy below growing stress in the fiscal and foreign fronts as a output of huge fiscal deficit & current account balance deficit. The error rectification specification is used to find evidence of long-running connection from fiscal deficit to current account deficit. The analysis results suggest that the current account balance deficit can be determined but the fiscal deficit budget balance is very challenging and from deficit to growth rate but through strong policies of the government for imposing direct and indirect taxes which will be strong can reduce the fiscal deficit and growing towards the growth rate of the economy.

ECONOMIC SECURITY CHALLENGES TO PAKISTAN DURING POST PANDEMIC ERA

Pakistan’s economy has faced many challenges since the inception of Pakistan as an independent state. The economy of country was largely dependent on agrarian resources during the initial decades and then industrial bases afterwards. During the past three decades it the economy of Pakistan depends on loans and financial aids from international financial institutions such as, IMF along the industrial growth. The world economy slowed down after the pandemic and it also had consequences on Pakistan economy. Covid-19 caused major disruption in Pakistan economy. As, Before pandemic the GDP growth rate was 2.50% in 2019 and it fell in negative point -1.27% during the fiscal year 2020. The economic challenges to Pakistan raised during pandemic era such as its GDP growth rate decreased in negative points, its fiscal debt increased to 12.74% in 2020 as compare to 2019. Unemployment, shut down of small businesses, increase in job displacement, fiscal deficit, decline in foreign direct investment are the few challenges to name. Therefore, the economic security of Pakistan had faced many challenges during the post pandemic era. The drastic impact of covid-19 forced government to take immediate steps to counter economic challenges. The first national security policy of Pakistan in this regard made economic indicators as a challenge and made economic security a part of national policy.

Unveiling the relation between household energy conservation and subjective well-being: Insights from structural equation modeling

Electricity is essential to Pakistan's economy and, it helps to improve the living standards of people. However, the state has long suffered from problems like imbalances in the supply of energy, excessive energy use, and frequent power outages. The present study focused on investigating the relationship between energy-saving behavior, consumption, and subjective well-being in households in urban areas of Punjab, Pakistan. Using Structural Equation Modeling (SEM), the research analyzed how different features of electricity use and energy-saving practices affect the quality of life for families in the region. According to research findings, a strong intention to save electricity is also linked to enhanced subjective well-being. When families have an intention toward conserving energy, they feel a more positive change in overall households' subjective well-being while electricity consumption which is measured in terms of electricity bills, negatively affects the household well-being. The current research concludes that some families can experience a financial benefit from lower energy bills, and others would need assistance switching to more environment-friendly energy habits. Governments must adopt price-control mechanisms and electricity subsidies for low-income groups to encourage ethical energy usage and well-being, while also undertaking awareness programs aimed at a varied audience.

Impact of Natural, Physical and Human Capital Formation on Economic Growth in Pakistan: An ARDL Analysis

Attaining sustained economic growth is one of the key objectives of any country to improve the well-being of its people and strengthen its economic position in the world. Capital formation is one of the crucial factors of economic growth as it promotes productivity, efficiency, and higher output growth. Therefore, this paper intends to analyze the impact of natural, physical, and human capital formation on economic growth in Pakistan by employing annual time series data from 1971 to 2020. Different econometric approaches such as unit root test, bound test, and ARDL model are utilized to estimate the results. The study found that labor force participation rate, physical capital, human capital, natural capital, FDI, and financial development are positively associated with economic growth in Pakistan. Instead of FDI, all the variables are found to be significantly related to economic growth in Pakistan. Considering the study’s findings, it is concluded that capital formation is essential to progress the economy of Pakistan, so policymakers must concentrate on investing in physical infrastructure, improvement in health and educational facilities, and efficient utilization of natural resources to promote economic growth.

STRATEGIC INTEGRATION OF CHINA-PAKISTAN ECONOMIC CORRIDOR (CPEC) IN ENHANCING THE MARINE FISHERY SECTOR OF PAKISTAN: A PATHWAY TO SUSTAINABLE ECONOMIC GROWTH

The marine fishery sector in Pakistan is particularly important in terms of the country’s economy but is still unexplored with problems such as old equipment, limited cold storage and processing, and not much investment made. Due to the emphasis on connectivity and economic cooperation under the framework of the China-Pakistan Economic Corridor (CPEC), it is possible to provide a strategic impetus to the development of the fishery sector. This research work seeks to establish how CPEC may improve the marine fishery industry of Pakistan and find out how the sector may benefit from CPEC investments in infrastructure and related facilities. The specific research questions the way CPEC infrastructure and investment could be optimally used for the development of the marine fishery sector of Pakistan for possible economic gains that could be associated with the integration of CPEC into the fishery sector. The study adopts a descriptive research type of approach whereby the researcher relies on secondary sources of information and analyzed data to assess the status of the marine fishery of Pakistan, identify the opportunities under CPEC for the sector, and establish how the sector can effectively integrate into the framework. The importance is in bringing attention to an overlooked sector that may benefit from the efficient use of CPEC projects. With investment and cooperation in the agriculture and socio-economic sectors, integration in the fishery sector will enhance Pakistan's blue economy and sustainable economic development.

Women-owned businesses and access to finance in Pakistan: a study of perceptions, experiences and behaviors

Purpose The purpose of this paper is to explore the perceptions, experiences and behaviors of women entrepreneurs and industry professionals in raising finance for women-led businesses and associated problems faced by the women entrepreneurs. Design/methodology/approach This qualitative research adopts a narrative inquiry strategy. In-depth interviews are used to collect data from women entrepreneurs and women industry professionals in Pakistan. NVivo qualitative data analysis software is used to organize, analyze and find insights in the qualitative data. Findings This research finds that women entrepreneurs struggle to secure financing for their businesses, and most of them have not been successful in obtaining loans from banks. Women entrepreneurs have relied on various sources of funding, including microfinance banks, grants, personal finance and family members. Some of the barriers to finance attainment for women entrepreneurs include sociocultural inhibitions, lack of awareness and limited information dissemination by financial institutions. Women professionals suggest that entrepreneurs should maintain a bank account, have proper documentation and show dedication to their business to improve their chances of obtaining financing. Research limitations/implications This research provides theoretical contributions and methodological advancements in the study of financial inclusion for women-owned businesses in Pakistan. This research raises awareness about the difficulties women entrepreneurs face when trying to obtain credit from banks and other financial institutions and provides policy recommendations to inform the government about financial inclusion policies and financing policies for women entrepreneurs. Overall, this research contributes to the literature on financial access and access to finance for women-owned businesses in developing countries. Originality/value Based on the vulnerable group theory and theory of discouraged borrower, this paper has two important theoretical and practical implications. First, the findings of this study reveal that the financial services are indifferent to women, and there is a denial of women being vulnerable in the financial system, hence requiring a major policy shift to not portray women as vulnerable, as they will rationally feel risky and prefer to opt out of the financial system. Second, the findings suggest that the issue of access to finance for women is not in the financial services but in the women's capabilities and awareness. Therefore, a policy shift is suggested from “financial services for women” to “capability and awareness of women” to avail and access the current services.

Examining the Impact of Economic Policy Shocks on Investment: Evidence from Pakistan and its Trade Partners

The objective of this study is to investigate the effect of both internal and external policy ambiguity on aggregate investment in Pakistan and its bilateral trade partners from the fourth quarter of 2010 to the fourth quarter of 2021. To achieve this, study uses economic policy uncertainty index for each country as a proxy for internal policy volatility. External policy volatility is measured by constructing a compound index that accounts for the trade weight of each country's policy uncertainty index. Further to find out the relationship, Panel PMG-ARDL model used and findings indicate that investment decrease with increase in uncertainty. Additionally, the research delves into the nonlinear relationship between investment and uncertainty and results demonstrate a U-shaped relationship between uncertainty and investments. Furthermore, Specific values were calculated to determine whether the effects of policy shocks are positive or negative, showing that internal policy shocks are more harmful than external ones. The study also provides policy implications based on these findings. Since internal policy insecurity has a stronger negative impact on investment than external factors, it is essential for policymakers in Pakistan to prioritize reducing ambiguity in internal policies. Implementing clear, consistent, and stable economic policies can help alleviate the negative effects of uncertainty on investment.