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On the validity of the Keynesian Absolute Income hypothesis in Pakistan: An ARDL bounds testing approach

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  • Shahbaz, Muhammad
  • Nawaz, Kishwar
  • Arouri, Mohamed
  • Teulon, Frédéric
  • Uddin, Gazi Salah

Abstract

The present paper contributes in existing economic literature by investigating the validity of the Keynesian Absolute Income hypothesis in Pakistan by applying the ARDL approach to cointegration. The findings of this paper validate the Keynesian absolute income hypothesis in Pakistan, where public savings and financial development add in private savings. This study opens up new insights for government to improve the level of private savings.

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  • Shahbaz, Muhammad & Nawaz, Kishwar & Arouri, Mohamed & Teulon, Frédéric & Uddin, Gazi Salah, 2013. "On the validity of the Keynesian Absolute Income hypothesis in Pakistan: An ARDL bounds testing approach," Economic Modelling, Elsevier, vol. 35(C), pages 290-296.
    • Handle: RePEc:eee:ecmode:v:35:y:2013:i:c:p:290-296
    DOI: 10.1016/j.econmod.2013.07.018
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    More about this item

    Keywords

    Private savings; Cointegration; Pakistan;
    All these keywords.

    JEL classification:

    • E2 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment
    • C4 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics

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