IDEAS home Printed from https://ideas.repec.org/a/rfh/bbejor/v6y2017i1p15-27.html
   My bibliography  Save this article

Domestic Saving Under the Perspective of Interest Rate, unemployment and inflation in Pakistan: A Time Series Analysis

Author

Listed:
  • Aramish Altaf Alvi

    (Department of Economics, University of the Punjab, Lahore, Pakistan)

  • Arooj Fatima

    (Department of Economics, University of the Punjab, Lahore, Pakistan)

Abstract

Domestic savings play a pivotal role in the process of economic growth as saving increases the amount of physical capital. Pakistan has issue of low aggregate saving for attaining and maintaining economic growth. This study has examined the impact of interest rate, unemployment rate, inflation rate and worker remittances on domestic savings in Pakistan. For examining the stationarity of the variables Augmented Dickey-Fuller unit root test is used. Maximum 2 lag are selected by following different lag selection criteria. Autoregressive Distributed Lag model is used for examining the cointegration among the variables of the model. On the basis of estimated results, it is concluded that interest rate, inflation rate, unemployment rate and worker remittances are playing important role in determining domestic savings in Pakistan. The government of Pakistan has been trying to increase overall rate of saving and for this purpose it introduces many schemes. But government is unable to get required results in this concerns because of low incomes, unemployment and improper implementation of the socio-economic policies. This study has tried to contribute in literature as existing literature hardly did this type of exercise.

Suggested Citation

  • Aramish Altaf Alvi & Arooj Fatima, 2017. "Domestic Saving Under the Perspective of Interest Rate, unemployment and inflation in Pakistan: A Time Series Analysis," Bulletin of Business and Economics (BBE), Research Foundation for Humanity (RFH), vol. 6(1), pages 15-27, March.
    • Handle: RePEc:rfh:bbejor:v:6:y:2017:i:1:p:15-27
    as

    Download full text from publisher

    File URL: https://bbejournal.com/index.php/BBE/article/view/179/135
    Download Restriction: no
    File URL: https://bbejournal.com/index.php/BBE/article/view/179
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Mohsin Hasnain Ahmad & Zeshan Atiq & Shaista Alam & Muhammad S. Butt, 2006. "The impact of demography, growth and public policy on household saving: a case study of Pakistan," Asia-Pacific Development Journal, United Nations Economic and Social Commission for Asia and the Pacific (ESCAP), vol. 13(2), pages 57-71, December.
    2. Aasim M. Husain, 1996. "Private Saving and Its Determinants: The Case of Pakistan," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 35(1), pages 49-70.
    3. Sumera Arshad & Amajd Ali, 2016. "Trade-off between Inflation, Interest and Unemployment Rate of Pakistan: Revisited," Bulletin of Business and Economics (BBE), Research Foundation for Humanity (RFH), vol. 5(4), pages 193-209, December.
    4. Tasnim Khan & Abid Rashid Gill & Sobia Haneef, 2013. "Determinants of Private Saving: A Case of Pakistan," Asian Journal of Economic Modelling, Asian Economic and Social Society, vol. 1(1), pages 1-7.
    5. Fawad AHMAD, 2015. "Determinants of Savings Behavior in Pakistan: Long Term- Short Term Association and Causality," Timisoara Journal of Economics and Business, West University of Timisoara, Romania, Faculty of Economics and Business Administration, vol. 8(1), pages 103-136, June.
    6. Tasnim Khan & Abid Rashid Gill & Sobia Haneef, 2013. "Determinants of Private Saving: A Case of Pakistan," Asian Journal of Economic Modelling, Asian Economic and Social Society, vol. 1(1), pages 1-7, December.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Tehreem Pervez, 2021. "The Role of Interest Rate, Unemployment and Inflation in Deciding Domestic Saving of Pakistan: An Empirical Analysis," Journal of Policy Research (JPR), Research Foundation for Humanity (RFH), vol. 7(1), pages 26-35, March.
    2. Naeem Akram, 2023. "Household’s Saving Behaviour in Pakistan: A Micro-Data Analysis," Studies in Microeconomics, , vol. 11(2), pages 139-156, August.
    3. Qazi-Muhammad Adnan Hye & Wee-Yeap Lau, 2018. "Does Financial and Trade Liberalization Drive Private Savings in Pakistan?," Asian Development Policy Review, Asian Economic and Social Society, vol. 6(4), pages 198-212, December.
    4. Nina Ellorah A Chua & Shaira Kasey L Kiong & Kristine Honey M Villa & Ronald B Paguta, 2016. "A Tobit Analysis of the Determinants and Potentials of Savings in the Case of Payatas Households," Information Management and Business Review, AMH International, vol. 8(3), pages 47-57.
    5. Fiaz Ahmad Sulehri & Saba Sharif, 2022. "The Impact of Firm Sustainability on Firm Growth: Evidence from USA," Journal of Policy Research (JPR), Research Foundation for Humanity (RFH), vol. 8(2), pages 1-15, August.
    6. Sumera Arshad & Amajd Ali, 2016. "Trade-off between Inflation, Interest and Unemployment Rate of Pakistan: Revisited," Bulletin of Business and Economics (BBE), Research Foundation for Humanity (RFH), vol. 5(4), pages 193-209, December.
    7. Aftab Ahmad, 2020. "Poverty Terrorism Nexus: A Case Study Of Pakistan," Bulletin of Business and Economics (BBE), Research Foundation for Humanity (RFH), vol. 9(4), pages 162-172, December.
    8. Muhammad Shahid & Khalil Ahmad & Muhammad Amir Inayat & Muhammad Kashif Bhatti, 2024. "Socio-Economic Determinants of Property Crime Across the Districts of Punjab: Highlighting the Role of Law Enforcement Agencies of Pakistan," Bulletin of Business and Economics (BBE), Research Foundation for Humanity (RFH), vol. 13(2), pages 22-36.
    9. Farooq Ahmad & Amna Gul & Syed Ali Raza Hamid & Zunaira Mahmood & Shahida Mariam, 2021. "Employees’ Own Personality May Induce Their Victimization At Work: Evidence From Universities In Lahore," Bulletin of Business and Economics (BBE), Research Foundation for Humanity (RFH), vol. 10(4), pages 13-21, December.
    10. Arif Khan & Gul Zeb Chaudhary, 2020. "Determinants Of Inflation In Case Of Pakistan," Bulletin of Business and Economics (BBE), Research Foundation for Humanity (RFH), vol. 9(4), pages 151-161, December.
    11. Muhammad Ijaz & Anum Aurangzeb & Saima Razzaq & Sajida Aslam, 2020. "Hurdles and Anxieties among Urdu EFL at Intermediate level in Pakistan," Journal of Policy Research (JPR), Research Foundation for Humanity (RFH), vol. 6(2), pages 1-7–11, December.
    12. Asif Sajid & Atif Khan Jadoon, 2020. "The level of Customer Satisfaction in Public and Private Banks in Lahore," Journal of Policy Research (JPR), Research Foundation for Humanity (RFH), vol. 6(2), pages 1-23–29, December.
    13. Muhammad Ashraf & Arslan Ali Raza & Muhammad Ishaq, 2022. "A Novel Approach Of Social Media Analytics For Predicting National Consumer Confidence Index," Bulletin of Business and Economics (BBE), Research Foundation for Humanity (RFH), vol. 11(2), pages 220-234, June.
    14. Molepa Seabela & Kanayo Ogujiuba & Maria Eggink, 2024. "Determinants of Income Inequality in South Africa: A Vector Error Correction Model Approach," Economies, MDPI, vol. 12(7), pages 1-17, July.
    15. Abdul Hai Rathore & Abdullah Sahi, 2022. "The impact of Corporate Governance on voluntary disclosure of R&D expenditure of USA Pharmaceutical firms," Journal of Policy Research (JPR), Research Foundation for Humanity (RFH), vol. 8(2), pages 34-53, August.
    16. Adeeba Rasheed & Anam Bashir, 2020. "Does Plastic Money Impact the Consumer Buying Behavior in Pakistan?," Journal of Policy Research (JPR), Research Foundation for Humanity (RFH), vol. 6(2), pages 1-18–22, December.
    17. Maria Safdar & Muhammad Zahid Naeem, 2020. "Outflow Of Human Capital And Health Sector In Pakistan," Bulletin of Business and Economics (BBE), Research Foundation for Humanity (RFH), vol. 9(3), pages 113-122, September.
    18. Shahid Manzoor Shah & Amir Nazir, 2018. "Linkages between Food Security and Human Well Bing in South Asia: An Empirical Analysis," Bulletin of Business and Economics (BBE), Research Foundation for Humanity (RFH), vol. 7(4), pages 197-207, December.
    19. Fiaz Ahmad Sulehri & Mohammad Ahmed & Amjad Ali, 2022. "Proprietorship Structure and Firm Performance in the Context of Tunneling: An Empirical Analysis of Non-Financial Firms in Pakistan," Journal of Policy Research (JPR), Research Foundation for Humanity (RFH), vol. 8(4), pages 115-124, December.
    20. Muhammad Zahid Naeem & Wajid Alim, 2019. "Determinants of Rural-Urban migration: A Case Study of Pakistan," Bulletin of Business and Economics (BBE), Research Foundation for Humanity (RFH), vol. 8(2), pages 105-116, June.

    More about this item

    Keywords

    Domestic saving; Inflation; Unemployment; Remittances; Interest Rate;
    All these keywords.

    JEL classification:

    • E2 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment
    • E3 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles
    • E4 - Macroeconomics and Monetary Economics - - Money and Interest Rates

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:rfh:bbejor:v:6:y:2017:i:1:p:15-27. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Dr. Muhammad Irfan Chani (email available below). General contact details of provider: https://edirc.repec.org/data/rffhlpk.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.