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Foreign Remittances, Long Term Sustainable Economic Growth Nexus in Pakistan: An Empirical Analysis Using Bound Testing Approach

Author

Listed:
  • Hina Ali

    (The women university multan)

  • Fouzia Yasmin

    (Department of Management Sciences, COMSATS University Islamabad, Pakistan.)

Abstract

Remittances are considered vital for the progress of any economy. These are the finances that are sent by the immigrants and assist the nations to achieve their basic needs and to boost the living standard. This research focuses on the effectiveness of foreign remittances regarding inflation and economic growth.The data used for this study are taken for the period 1972-2018 as yearly based. To check the stationary of the data Augmented Dickey-Fuller (ADF) test is used and the methodological framework includes the Autoregressive Distributed Lag (ARDL) model that concluded that the study concludes that foreign remittances have an optimistic and momentous relation with the economic growth of Pakistan. It was concluded in the study at hand the remittances lead to enhance economic growth through the expansion in individual consumption. Thus, it should emerge that remittances are a superior tool to address transient poverty which occurs due to the shocks whether at the domestic or general level rather than a structural scarcity.

Suggested Citation

  • Hina Ali & Fouzia Yasmin, 2020. "Foreign Remittances, Long Term Sustainable Economic Growth Nexus in Pakistan: An Empirical Analysis Using Bound Testing Approach," Pakistan Journal of Economic Studies, Department of Economics, The Islamia University of Bahawalpur, Pakistan., vol. 3(2), pages 187-204, December.
    • Handle: RePEc:akw:iupjes:v:3:y:2020:i:2:p:187-204
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    File URL: https://journals.iub.edu.pk/index.php/pjes/article/view/398/88
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    File URL: https://journals.iub.edu.pk/index.php/pjes/article/view/398
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    More about this item

    Keywords

    Remittances; Sustainable; Economic Growth; ARDL.;
    All these keywords.

    JEL classification:

    • F24 - International Economics - - International Factor Movements and International Business - - - Remittances
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • Q01 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - General - - - Sustainable Development
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

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