Business and Economic Horizons
Previous Article | Back to Volume | Next Article | |
Abstract | References | Citation | Download | Preview | Statistics | |
Volume | 6 |
Issue | 3 |
Online publication date | 2011-09-15 |
Title | Estimation of import and export demand functions using bilateral trade data: The case of Pakistan |
Author | Jahanzaib Haider, Muhammad Afzal, Farah Riaz |
Abstract | We estimated the import and export elasticities of Pakistan trade with traditional trade partners and some Asian countries to see the dynamics of Pakistan trade from 1973 to 2008. OLS results suggest that income is the principal determinant of exports and imports. Pakistan exports are cointegrated with Japan and USA while the imports are cointegrated with UAE and USA. Pakistan imports and exports are cointegrated with Bangladesh and Sri Lanka but not with India and China. Income and exchange rate are both important determinants of foreign trade. Continuing its trade with traditional partners and making efforts for greater market access to USA and EU, Pakistan should make efforts to increase its trade with Asian countries notably China and India because both are fast growing economies and have huge market |
Citation | |
References | Afzal, M. and Ali, K., 2008. “A historical evaluation of export-led growth policy in Pakistan,” Lahore Journal of Policy Studies, Vol.2(1), pp.69-82 Afzal, M., 2001a. “Import functions for Pakistan – A simultaneous equation approach, The Lahore Journal of Economics, Vol.6(2), pp.109-16 Afzal, M., 2001b. Exports in a simultaneous Model – The case of Pakistan, Government College, Economic Journal, Vol.35(1 &2), pp.53-66 Afzal, M., 2002. “Price separation and supply price specification of exports: Evidence from Pakistan, The Lahore Journal of Economics, Vol.7(1), pp.107-16 Afzal, M., 2004. “Exports-economic growth nexus: Pakistan’s experience, Indian Journal of Business and Economics, Vol.3(2), pp.315-40 Afzal, M., 2005. “Demand and supply of exports in Pakistan: a disequilibrium model, Lahore Journal of Economics, Vol.10(1), pp.49-64 Afzal, M., 2006a. “Causality between Exports, World income and economic growth in Pakistan, International Economic Journal, Vol.20 (1), pp.63-77 Afzal, M., 2006b. “Import functions for Pakistan: A dynamic model, Government College Economic Journal, Vol.37(1&2), pp.1-12 Afzal, M., 2008a. “Impact of exchange rate on import demand in Pakistan,” Pakistan Journal of Applied Economics, Vol.18 (1&2), pp.123-41 Afzal, M., 2008b. “Long-run relationship between imports and exports: Evidence from Asian countries,” The Singapore Economic Review, Vol.53(2), pp.1-19 Akbar, M. and Naqvi, Z., 2001. “External market conditions, competitiveness, diversification, and Pakistan’s export performance, The Pakistan Development Review, Vol.40(4), pp.871-84 Akhtar, S. and Malik, F., 2000. “Pakistan’s trade performance vis-à-vis its major trading partners, The Pakistan Development Review, Vol.39(1), pp.37-50 Anwar, S., 1985. Exports functions for Pakistan: A simultaneous equations approach, Pakistan Journal of Applied Economics, Vol.4(1), pp.29-34 Arize, A., 2000. Imports and exports in 50 countries Tests of cointegration and structural breaks, International Review of Economics and Finance, Vol.11 (1), pp.101-15 Atique, Z. and Ahmad, M., 2003. “The supply and demand for exports of Pakistan, The polynomial distributed lag model (PDL) approach, The Pakistan Development Review, Vol.42(4), pp.961-972 Bader, S., 2006. “Determining import intensity of exports for Pakistan,” SBP (State Bank of Pakistan) Research Bulletin, 2(2), pp.363-81 Bond, M. 1985. “Export demand and supply for groups of non-oil developing countries,” Staff Papers - International Monetary Fund, Vol.32(1), pp.56-77 Engle, R. and Granger, 1987. “Cointegration and error correction: Representation, estimation and testing,” Econometrica, Vol.55(2), pp.251-76 Johansen, S., 1991. “Estimation and hypothesis testing of cointegration vectors in Gaussian vector autore-gressive models,” Econometrica, 59(6), pp.1551-580 Johansen, S., 1995. Likelihood-based Inference in cointegrated vector autoregressive models (Oxford University Press) Kemal, A., 2004. “Exploring Pakistan’s regional economic cooperation potential,” The Pakistan Development Review, Vol.43(4), pp.313-34 Khan, A. and Saqib, N., 1993. “Exports and economic growth: The Pakistan experience,” International Economic Journal, 7(3), pp.53-64 Khan, M. and Knight, M., 1988. “Import compression and export performance in developing countries,” The Review of Economics and Statistics, Vol.70 (2), pp.315-32 Naqvi, S., Khan, A., Khilji, N., and Ahmed, A., 1983. The PIDE macro-econometric model of Pakistan's economy, Islamabad, Pakistan Institute of Development Economics Rana, P., 1983. The impact of generalized floating on trade flows and reserve needs, Selected Asian Developing countries, New York Garland Publishers Sarmad, K. and Mahmood, R., 1985. “Price and income elasticities of consumer goods imports,” The Pakistan Development Review, Vol.24(3&4), 453-61 Sarmad, K., 1989. “The determinants of import demand in Pakistan,” World Development Review, Vol.17(10), pp.1619-625 Sinha, D., 1997. “Determinants of import demand in Thailand, International Economic Journal,” Vol.11(4), pp.73-83 Government of Pakistan, 2007-08. Economic Survey (various issues), Islamabad, Ministry of Finance, Economic Advisor Wing Government of Pakistan, 2009-12. Strategic Trade Policy Framework, Islamabad, Ministry of Commerce IMF, Direction of Trade Statistics (Various issues), Washington DC IMF, International Financial Statistics (Various issues), Washington DC |
Keywords | Imports and exports elasticities, Pakistan, Asian countries, cointegration |
DOI | http://dx.doi.org/10.15208/beh.2011.17 |
Pages | 40-53 |
Download Full PDF | Download |
Previous Article | Back to Volume | Next Article |
Share |