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Empirical analysis of non economic determinants of private investment in Pakistan (1969-2016)

Turkish Economic Review

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Title Empirical analysis of non economic determinants of private investment in Pakistan (1969-2016)
 
Creator BHUTTO, Mehwish;

Assistant Professor, Department of Economics, University Of Sindh, Jamshoro.


SHAIKH, Erum Khushnood Zahid;

Associate Professor, Department of Economics, University Of Sindh, Jamshoro.


SHAH, Parveen; Professor, Vice-Chancellor, Shah Abdul Latif University, Khairpur
 
Subject Private investment; Corruption; Political instability; Violence; Time series data; Pakistan.
D72; D73; E20; E22.
 
Description Abstract. Private and public investment has own contribution to the growth process of an economy. Private investment is very crucial for economic growth and poverty reduction. Whereas, public investment contributes positively to economic growth through enhancing the productivity of private investment (Ang, 2009). Various empirical studies in developing countries showed that economies led by the private sector achieved better economic performance than the one led by the state. Pakistan has a very sluggish growth in private sector which is a major cause of slow economic growth in the country. So, it is very important to explore the factors which can stimulate the private sector investment in Pakistan. Therefore, this research is designed to find out major non economic determinants which can stimulate or hinder the private investment in Pakistan. Studies on non economic determinants are not sufficient in Pakistan so this study will fill the Gap. In this study for estimation, ARDL approach was applied on time series secondary data (i.e. from 1969 to 2016). The empirical evidence confirms that there exists a long run relationship exist between dependent and independent variables in the model. Furthermore, in the long run, corruption, political instability and violence have significantly negative impact on private investment. Results also suggested that in the short run, the disequilibrium is rapidly adjusted. Based on study results, it is recommended that policy makers develop more effective policies of good governance to improve the private investment.Keywords. Private investment, Corruption, Political instability, Violence, Time series data, Pakistan.JEL. D72, D73, E20, E22.
 
Publisher Turkish Economic Review
Turkish Economic Review
 
Contributor —
 
Date 2018-10-19
 
Type info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion
—
 
Format application/pdf
 
Identifier http://www.kspjournals.org/index.php/TER/article/view/1735
10.1453/ter.v5i3.1735
 
Source Turkish Economic Review; Vol 5, No 3 (2018): September; 256-262
Turkish Economic Review; Vol 5, No 3 (2018): September; 256-262
2149-0414
 
Language eng
 
Relation http://www.kspjournals.org/index.php/TER/article/view/1735/1738
 
Rights Copyright (c) 2018 Turkish Economic Review
http://creativecommons.org/licenses/by-nc/4.0