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Impact of Cost-Push and Monetary Factors on GDP Deflator: Empirical Evidence from the Economy of Pakistan

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  • Zahoor Hussain Javed
  • Muhammad Farooq
  • Maqsood Hussain
  • Abdur-Rehman Shezad
  • Safder Iqbal
  • Shama Akram

Abstract

The central objective of this paper is to find the validity of cost-push and monetary factors on GDP deflator through empirical analysis. The empirical analysis has been conducted by using the technique of Ordinary Least Square using annual data for the period from 1971-72 to 2006-07. Before applying OLS the stationarity of the data was checked by Augmented Dickey Fuller (ADF) test. Regression analysis proves that both cost-push and monetary factors are influenced on wholesale price index. The monetary variables have significant impact on GDP deflator.. There is no single remedy to control the raise of wholesale price index. Government should adopt multipurpose strategy such as improvement in tax and revenue structure, improving fiscal and monetary discipline, removing supply side disruptions, eradication of anti-competitive market practice.

Suggested Citation

  • Zahoor Hussain Javed & Muhammad Farooq & Maqsood Hussain & Abdur-Rehman Shezad & Safder Iqbal & Shama Akram, 2011. "Impact of Cost-Push and Monetary Factors on GDP Deflator: Empirical Evidence from the Economy of Pakistan," International Journal of Financial Research, International Journal of Financial Research, Sciedu Press, vol. 2(1), pages 57-63, March.
    • Handle: RePEc:jfr:ijfr11:v:2:y:2011:i:1:p:57-63
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    References listed on IDEAS

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    1. Albert Makochekanwa, 2007. "A Dynamic Enquiry into the Causes of Hyperinflation in Zimbabwe," Working Papers 200710, University of Pretoria, Department of Economics.
    2. מחקר - ביטוח לאומי, 1996. "Volume 4," Working Papers 65, National Insurance Institute of Israel.
    3. Ashfaque H. Khan & Mohammad Ali Qasim, 1996. "Inflation in Pakistan Revisited," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 35(4), pages 747-759.
    4. Abdul Qayyum, 2006. "Money, Inflation, and Growth in Pakistan," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 45(2), pages 203-212.
    5. Zaidi, S.Akbar, 2005. "Issues in Pakistan's Economy," OUP Catalogue, Oxford University Press, edition 2, number 9780195979145.
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    Cited by:

    1. Uddin , Ijaz, 2020. "What determine inflation in Pakistan: an investigation through structural equation modeling by using time series data for a period from 1975 to 2017," Economic Consultant, Roman I. Ostapenko, vol. 32(4), pages 54-72.

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