RELATIONSHIP OF EXPORT AND ECONOMIC GROWTH; AN EMPIRICAL STUDY OF PAKISTAN

Abstract

Pakistan has been facing the phenomenon of disturbed economy and unequal distribution of income. Export sector is not being given the required importance in most of countries. It requires attention toward outward oriented policies and international markets. This research aims at studying the impact of export on the economy. The relationship of export and economic growths for Pakistan is the major point. Independent variables in the study include Export, Inflation and Real Exchange Rate. Ordinary Least Square has been used for empirical analysis of relationship of export and economic growth for 30 years (1980-2009). Results shows that there is strongly positive and significant effect of export, Inflation and Real exchange rate on economic growth. These results are acceptable because inflation and Real exchange rate have mixed effect on Economic Growth. Research is limited up to some years. Different products of export can be studied and a research of export on the basis of tariff and non-tariff goods is also a way to enhance the research of export-led economic growth hypothesis. This research gives policy makers an approach to map out the future policy standards for boosting exports in order to avail the opportunity of economic growth. This study is in accordance with Rubina Vohra (2010).she explains that the relationship of export and economic growth is significant and positive. Economic growth is the combination of different progressive areas but each area should be given equal importance in order to achieve the target as a whole. Export has not been given required attention in Pakistan economy. Different techniques should be adopted to attain ideal picture of economy in worldwide competition.

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