Foreign direct investment and liberalization policies in Pakistan: An empirical analysis
To enhance the inflow of foreign direct investment (FDI) and ultimately to increase the economic growth, the countries have implemented a variety of financial and trade liberalization policies in the last three decades. Pakistan also initiated such type of policies. This study makes an analysis of t...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
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Taylor & Francis Group
2014-12-01
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| Series: | Cogent Economics & Finance |
| Subjects: | |
| Online Access: | http://dx.doi.org/10.1080/23322039.2014.944667 |
| _version_ | 1818294464894992384 |
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| author | Rana Ejaz Ali Khan Qazi Muhammad Adnan Hye |
| author_facet | Rana Ejaz Ali Khan Qazi Muhammad Adnan Hye |
| author_sort | Rana Ejaz Ali Khan |
| collection | DOAJ |
| description | To enhance the inflow of foreign direct investment (FDI) and ultimately to increase the economic growth, the countries have implemented a variety of financial and trade liberalization policies in the last three decades. Pakistan also initiated such type of policies. This study makes an analysis of the impact of liberalization (financial and trade) in Pakistan, on the inflow of FDI using the time series data of 1971–2009. The DF-GLS test is used to determine the level of integration, and autoregressive distributed lag model to examine the long-run relationship. The results indicate that liberalization indicators, like financial liberalization index and trade openness along with real interest rate, negatively affect the inflow of FDI in Pakistan. Tax revenue of product also negatively affects the FDI. On the other hand, the gross fixed capital formation, infrastructure, and inflation positively influence the FDI in Pakistan. The market size (proxied by real gross domestic product) has shown insignificant effect on FDI. |
| first_indexed | 2024-12-13T03:32:10Z |
| format | Article |
| id | doaj.art-8a5d4cebd9154a388743bdbedf0a0061 |
| institution | Directory Open Access Journal |
| issn | 2332-2039 |
| language | English |
| last_indexed | 2024-12-13T03:32:10Z |
| publishDate | 2014-12-01 |
| publisher | Taylor & Francis Group |
| record_format | Article |
| series | Cogent Economics & Finance |
| spelling | doaj.art-8a5d4cebd9154a388743bdbedf0a00612022-12-22T00:01:08ZengTaylor & Francis GroupCogent Economics & Finance2332-20392014-12-012110.1080/23322039.2014.944667944667Foreign direct investment and liberalization policies in Pakistan: An empirical analysisRana Ejaz Ali Khan0Qazi Muhammad Adnan Hye1The Islamia University of BahawalpurCollege of Business Management (CBM), IOBMTo enhance the inflow of foreign direct investment (FDI) and ultimately to increase the economic growth, the countries have implemented a variety of financial and trade liberalization policies in the last three decades. Pakistan also initiated such type of policies. This study makes an analysis of the impact of liberalization (financial and trade) in Pakistan, on the inflow of FDI using the time series data of 1971–2009. The DF-GLS test is used to determine the level of integration, and autoregressive distributed lag model to examine the long-run relationship. The results indicate that liberalization indicators, like financial liberalization index and trade openness along with real interest rate, negatively affect the inflow of FDI in Pakistan. Tax revenue of product also negatively affects the FDI. On the other hand, the gross fixed capital formation, infrastructure, and inflation positively influence the FDI in Pakistan. The market size (proxied by real gross domestic product) has shown insignificant effect on FDI.http://dx.doi.org/10.1080/23322039.2014.944667F21—international investment; long-term capital movementsO16—financial markets; saving and capital investment |
| spellingShingle | Rana Ejaz Ali Khan Qazi Muhammad Adnan Hye Foreign direct investment and liberalization policies in Pakistan: An empirical analysis Cogent Economics & Finance F21—international investment; long-term capital movements O16—financial markets; saving and capital investment |
| title | Foreign direct investment and liberalization policies in Pakistan: An empirical analysis |
| title_full | Foreign direct investment and liberalization policies in Pakistan: An empirical analysis |
| title_fullStr | Foreign direct investment and liberalization policies in Pakistan: An empirical analysis |
| title_full_unstemmed | Foreign direct investment and liberalization policies in Pakistan: An empirical analysis |
| title_short | Foreign direct investment and liberalization policies in Pakistan: An empirical analysis |
| title_sort | foreign direct investment and liberalization policies in pakistan an empirical analysis |
| topic | F21—international investment; long-term capital movements O16—financial markets; saving and capital investment |
| url | http://dx.doi.org/10.1080/23322039.2014.944667 |
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