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Saving-investment Behaviour in Pakistan: An Empirical Investigation

Author

Listed:
  • Shahbaz Nasir

    (Pakistan Institute of Development Economics, Islamabad.)

  • Mahmood Khalid

    (State Bank of Pakistan, Islamabad.)

Abstract

This paper explores the saving-investment behaviour in Pakistan by identifying their patterns over time and across selected Asian countries. Further potential determinants were empirically tested, based on theoretical foundations of modelling for saving and investment behaviour. Savings in Pakistan for our sample period showed a positive response to GDP growth and government current expenditure while it remained insensitive to interest rates. On the other side, domestic savings and short-run expected returns positively affected investment whereas uncertainty reduced investment.

Suggested Citation

  • Shahbaz Nasir & Mahmood Khalid, 2004. "Saving-investment Behaviour in Pakistan: An Empirical Investigation," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 43(4), pages 665-682.
    • Handle: RePEc:pid:journl:v:43:y:2004:i:4:p:665-682
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    File URL: http://www.pide.org.pk/pdf/PDR/2004/4/PartII/Shahbaz.pdf
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    References listed on IDEAS

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    Cited by:

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    2. Md. Shabbir Alam & Mustafa Raza Rabbani & Mohammad Rumzi Tausif & Joji Abey, 2021. "Banks’ Performance and Economic Growth in India: A Panel Cointegration Analysis," Economies, MDPI, vol. 9(1), pages 1-13, March.
    3. Success Abusomwan & Jessy Ezebuihe, 2017. "Gross Domestic Savings And Gross Capital: What Matters To Their Formation In An Era Of Economic Recession In Nigeria?," Oradea Journal of Business and Economics, University of Oradea, Faculty of Economics, vol. 2(2), pages 45-55, September.
    4. Matthew McCartney, 2011. "Pakistan, Growth, Dependency, and Crisis," Lahore Journal of Economics, Department of Economics, The Lahore School of Economics, vol. 16(Special E), pages 71-94, September.
    5. Shah, Syed Hasanat & Hasnat, Hafsa & Cottrell, Simon & Ahmad, Mohsin Hasnain, 2020. "Sectoral FDI inflows and domestic investments in Pakistan," Journal of Policy Modeling, Elsevier, vol. 42(1), pages 96-111.
    6. Saba Mushtaq & Danish Ahmed Siddiqui, 2016. "Effect of interest rate on economic performance: evidence from Islamic and non-Islamic economies," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 2(1), pages 1-14, December.
    7. Saeed, Muhammad Yasir & Ramzan, Muhammad & Hamid, Kashif, 2020. "Causal and Dynamic Link Between the Banking Sector and Economic Growth in Pakistan," Asian Journal of Applied Economics, Kasetsart University, Center for Applied Economics Research, vol. 27(01).
    8. Błoch Wiktor, 2023. "What drives the savings rate in middle -income countries?," Economics and Business Review, Sciendo, vol. 9(4), pages 56-73, December.
    9. Shaikh, Salman, 2012. "Consumption & Savings Behavior in Pakistan," MPRA Paper 42496, University Library of Munich, Germany.
    10. Sharafat, Ali & Hamid, Waqas & Muhammad, Asghar & Raheel Abbas, Kalroo & Muhammad, Ayaz & Mukhtyar, Khan, 2013. "Foreign Capital and Investment in Pakistan: A Cointegration and Causality Analysis," MPRA Paper 55640, University Library of Munich, Germany, revised 28 Apr 2013.
    11. Shazia Zahid, AB. Basit, 2018. "Impact of Macroeconomic Factors on the Growth of Islamic Banking: A Case of Pakistan," Journal of Finance and Economics Research, Geist Science, Iqra University, Faculty of Business Administration, vol. 3(2), pages 37-50, October.
    12. Ismail, Aisha & Rashid, Kashif, 2013. "Determinants of household saving: Cointegrated evidence from Pakistan (1975–2011)," Economic Modelling, Elsevier, vol. 32(C), pages 524-531.
    13. Ali, Sharafat, 2013. "A Cointegration Approach to Estimate Private Investment Demand Function of Pakistan," MPRA Paper 49595, University Library of Munich, Germany, revised 02 Sep 2113.
    14. Shaikh, Salman, 2013. "Micro Foundations of Savings Behavior in Urban Pakistan," MPRA Paper 53805, University Library of Munich, Germany.

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    More about this item

    Keywords

    saving Investment; Pakistan;

    JEL classification:

    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth

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