Economic crisis in Pakistan - ESSAY. Muhammad Hamza. Economic crisis in Pakistan Present situation: It can be easily observed that, the Pakistani rupee has sunk by over 30 percent in the past seven months owing to a balance of payment quagmire. Recently the rupee touched against the U.S. blogger.comted Reading Time: 10 mins Feb 03, · Whereas some expert economists of the country comment that Pakistan’s economy is near collapse, others are of the view that although our economy is still away from the verge of immediate collapse it is so fragile that unless serious and urgent efforts are made to survive the economy, it can move to a dangerous stage within about next six to 12 months Jun 01, · Essay on Current Economic Situation in Pakistan Last updated on Saturday, June 1st, - 1 Comment The economy of our country has been sick along with the economies of several other South-Asian countries that rightly form the club of “sick men of Asia” as once Turkey was the sick man of Europe
Current Situation of Pakistan Economy - Words | Bartleby
The economical condition of Pakistan from last three to four decades is instable due to war and terror situation. That is why negative effect of economy and prices are not stable. Government failed to make a proper any economy essay on current economic situation of pakistan to improve their price level and other problem to solve.
Economical instability, energy crises, high unemployment, low exports, low foreign exchange reserves, low income level and other social, economic and political issues. All these problem have direct effect on business activity, instable price level and economic growth.
If analyzed past situation of price instability and the trend of gross domestic production in Pakistan then very fluctuation in past period. Pakistan independence in and economically condition was very critical price are unstable, unemployment, lack of infrastructure and other social and economic problems. In to average growth rate was 3 percent in Pakistan. Ins inflation rate single digit was 1. Though, it very well performed economy.
In Pakistan during s, the Pak and India war over Kashmir also effect the economy. Instrend was same almost. The growth of GDP was decrease In GDP growth rate 7. During s Zia -ul -haq favorer of privatization was carried out steadily and the growth rate of GDP was Different governments and two elected prime ministers during High budget deficit in then International Monetary Fund IMF provide the loan to reduced defense expenditures, improved tax collection methods and inflation rate ranged between 9.
In s, food and nonfood product are effected to high increased inflation rate In after September 11incident, economically condition of world absolutely changed and growth rate of GDP, price level and inflation was effected. In inflation and growth rate of GDP was average. Last two three years high inflation trend in Pakistan and negative essay on current economic situation of pakistan on economic growth and unstable price level.
The factors leading to high levels of price instability include deficit financing, decrease in foreign remittances, dependency of economy of foreign economic assistance, terrorism, increase in wages, high price of imported goods, devaluation of rupee, decrease foreign direct investmentlarge scale manufacturing industry, effect imports exports and balance of trade etc.
High inflation is always correlated with increased price instability, which can lead to uncertainty about the future profitability of investment projects. The significant of study is to explore the reasons that caused increasing the current price level and its direct effect on economic growth.
Problem definition can be defined as the gap between existing and ideal or desired situation. According to research question of this study is; "How price instability have an effect on economic growth in Pakistan? Objectives are very important for research work. Objective help to achieve the goal and aim of research work. The objective of the study is to find out the factors, which can affect the depended economic growth and independent variables inflation, investment, Govt expenditure population, and net exports.
Also, find out the relationship of price instability and economic growth. Achieve their objective for using different techniques and methods. To achieve these research objectives, for using the econometric techniques and developed the model to check the impact of prices instability on economic growth. Conduct the hypothesis to achieve the objective. Prices instability has been measured through inflation and applied the Co-integrating Vector and Vector Error Correction Model VECM whit the help of E-views software.
For this purpose various studies have been presented on the issue of price instability and economic growth in Pakistan. Most of this research topic has been done by national and internationally. Reviewed of some articles are important empirical studies to develop the objectives in the context of Pakistan. Therefore, keeping in view the importance of literature relevant to research topic, the literature was surveyed about the analysis of price instability and economic growth at national as well as at international level.
The literature about the determinants of price was also reviewed in the research study. The price instability was an important determinant of economic in the essay on current economic situation of pakistan of empirical findings of a number of research studies. Fischer analyzed that the cross-sectional and panel data regressions for results indicate that inflation reduces growth by essay on current economic situation of pakistan investment and productivity growth.
Further notes that, essay on current economic situation of pakistan, level expansion and little monetary deficiencies are not fundamental for towering development even over long periods; in like manner, towering swelling is not steady with managed monetary development. Motley examined that the inflation also affect investment and saving decisions. High inflation essay on current economic situation of pakistan the growth of GDP constant to investment level and less accumulated human and physical capital in the economy.
High inflation in the economy then rate of return on investment decreased. May causes that the investor and saver to be less willing to invest in projects. Barro analyzed that the effect on price instability and economic growth for data used examined countries from to It applied regression and results show significance effect on explanatory variables. If increased in inflation 10 percentage per year reduced of the growth rate of per capita GDP by 0. Statically significant results highlighted when high inflation reduced GDP and negative impact on economic growth and price level.
Sarel examined on population, GDP, consumer price indices, terms of trade, real exchange rates, government expenditures and investment rates. Joint board database was prepared joining together enduring yearly information from 87 nations, throughout the time of The observational findings give confirmation of the being of a structural break that is huge. The break is estimated to occur when the inflation rate is 8percent. Estimation result impact of inflation on growth rate is significant.
z analyzed that the high economic growth compounded with high inflation in Chinese economy. Analyzed the data form period and results significant show that the high inflation generate d by over investment, low growth of GDP and not beneficial for development.
Nell examined that the inflation is always harmful to growth use the data for period in South Africa economies. For this purpose conduct a model and chose a variables. Vector Auto Regressive VAR technique applied in the model and results show that inflation was single digit beneficial for economic growth and inflation double digit was harmful for economy because slow economic growth.
Liu and Adedeji analyzed that the major determinants of inflation in the Islamic Republic of Iran. Time series data had been chosen from for this study. The authors had applied Johansen co-integration test and Vector Error Correction Model VECM to examine the results. The analysis had found that lag value of money supply, monetary growth, four years previous expected rate of inflation was positively contributed towards inflation while two years previous value of exchange premium was negatively correlated with inflation.
Chowdhury examined that the relationship between inflation and GDP growth for four South Asian countries Pakistan, India, Bangladesh and Sri-Lanka. Used the data for period and error correction applied in the model, essay on current economic situation of pakistan. Results show that the significant relationship between inflation and economic growth for all four countries. Khan and Senhadji calculated that the threshold1 level for both the developing, including Pakistan, and developed economies.
This studies use panel data for developing countries and developed economies for the period to and threshold levels, 3percent and 7percent, for both group of countries severally. Thoursie examined that the high inflation impact on GDP growth rate and collected the annual data for period from countries.
Time —specific shock and heterogeneity techniques applied in the exogenous and endogenous variables. Result significant show that the inflation was harmful to the growth of GDP and negative correlation between high price inflation and growth rate.
Rousseau and Wachtel examined that there is negative relationship between prices instability and economic growth and found relationship between financial development, price instability and economic growth. The study show that the triangle of relationship between financial development, price instability and economic growth with the data from 84 countries covering the period of analysis from to Finance and economic growth relationship is stronger than price instability and economic growth, essay on current economic situation of pakistan.
Sweidan examined that the relationship between price instability and economic growth for economy of Jordan in and finds a structural break point at 2 percent level of inflation.
The study is to check the impact of swelling doubt on the development and growths in the economy. The effect intimates that the impacts of expansion on development are stronger as contrasted with the impacts of swelling questionable matter and variability.
Gokal and Hanif analyzed several different economic theories to develop consensus on the inflation and economic growth relationship for the economy of Fiji in The results show that a weak negative correlation exists between prices instability and economic growth, while the change in output gap takes important aim. The causality between the two variables are one-way from GDP growth to price instable. Minli examined the relationship between inflation and economic explain by using data for 90 developing countries and 28 developed countries over the period Essay on current economic situation of pakistan proof powerfully supports the read that the connection between inflation and economic process is nonlinear.
Mubarik calculated the threshold level of rising prices in Pakistan using annual data for the period to The empirical results from the study suggest 9 percent threshold level of inflation for the economy of Pakistan, above which inflation is very unfavorable for economic growth.
Suberive examined the essay on current economic situation of pakistan of international price instability on the aggregate supply, taking account which features of infrastructure, price instability, essay on current economic situation of pakistan, and financial changing.
The study examined the sample of 25 countries during the period to Results highlight that there is a negative effect of international price instability on aggregate supply. Moreover, essay on current economic situation of pakistan, they show that high price instable, low infrastructure and less developed financial system contribute to reinforce this effect.
Chaturvedi and Kumar discussed interrelation between inflation, economic growth and saving rate for South East and South Asia countries in The relationship between saving rates and economic growth has found positive, inflation has positive outcome on saving rate and considerably negatively effect on economic growth this research show that at lower rate of price instable relationship is positive but rising price describes negative impact on economic growth.
The study however, indicates that below these thresholds the results of inflation on growth area unit considerably positive. Lebanon, examined that the relationship between inflation and economic growth in the U. A country. Two Stage least Square 2SLS estimation technique used in the model. Statically significant results show that the inverse relationship between inflation and economic growth in U.
country expectation-augmented Philips curve was not eliminating the inverse relationship between High inflation and economic growth. Hasanov examined that the threshold effect of inflation on economic growth over the period of Estimated threshold model indicate that there is a non-linear relationship between economic growth and price instability.
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, time: 2:22Essay Outline: Economic Crisis in Pakistan: Challenges and Prospects
Economic crisis in Pakistan - ESSAY. Muhammad Hamza. Economic crisis in Pakistan Present situation: It can be easily observed that, the Pakistani rupee has sunk by over 30 percent in the past seven months owing to a balance of payment quagmire. Recently the rupee touched against the U.S. blogger.comted Reading Time: 10 mins Mar 07, · CSS Essay Outline: Economic Crisis in Pakistan: Challenges and Prospects By: Mureed Hussain Jasra (CSP) Introduction. 1. Global economic crisis 2. Economy of Pakistan at a crossroads 3. Causes of economic decay In Pakistan. Challenges of Economic Crisis in Pakistan. 1. Dwindling foreign exchange reserves 2. Current account deficit increasing Estimated Reading Time: 2 mins Short essay on Economic Conditions in Pakistan. Article Shared By. ADVERTISEMENTS: While multiple economies in the world suffer from global recession, Pakistan’s economy is no exception. Moreover, developing economies like Pakistan have suffered more from this crisis situation than other developed countries blogger.comted Reading Time: 3 mins
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