Ashfaque H. Khan

Dependency Ratio, Foreign Capital Inflows and the Rate of Savings in Pakistan

Domestic resource mobilization is one of the key determinants of sustained economic growth. The savings rate in Pakistan is sensitive to per capita income, dependency ratio, real interest rate and foreign capital inflows. Dependency ratio and foreign capital inflows exert a depressing effect on savings while income and real interest rate have a positive effect. Realistic interest rate policies in the context of liberalized financial markets are required to mobilize greater savings.

Real Money Balances in the Production Function of a Developing Country

Real money balances as a factor input in the production function of the large-scale manufacturing sector in Pakistan has been examined in a multi-equation framework. Besides labor and capital, real money balances turned out to be an important factor of production. Our results are in accordance with the pioneering work of Sinai and Stokes in this area.

A reexamination of the stability of the demand for money in pakistan

Abstract This paper examines the stability of the demand for money function in Pakistan (1959–1960 to 1986–1987) using a fairly robust econometric technique which permits parameters to vary over time. The results show that the money demand function was stable with both M 1 and M 2 definitions of money for the period 1959–1960 to 1980–1981 and became unstable thereafter. It is also found that multiple interest rates are preferred explanatory variables and lend stability to the demand for money function (especially M 1 ).

The demand for money and the variability of the rate of inflation: An emperical note

Abstract In this note we incorporate the effect of inflation variability on the demand for money in Pakistan. It is found that this variable has a significant impact on money demand function. Our results are similar to those of Klein while they differ with Blejer.

Aggregate consumption function and income distribution effect: Some evidence from developing countries

Abstract The effect of income distribution on aggregate consumption has been examined for 20 developing countries for the period 1975–1979. The findings of this paper are in accordance with the conventional Keynesian wisdom that equalization of income distribution increases aggregate consumption.

What drives stock market growth? A case of a volatile emerging economy

ABSTRACT We study the determinants of the explosive stock market growth and increased foreign portfolio investment in Pakistan. Our results indicate that in contrast to evidence from developed markets, the aggregate stock returns are not driven by macroeconomic fundamentals in Pakistan. Moreover, foreign portfolio investors do not tend to react to changes in economic variables in Pakistan. As fundamentals fail to affect stock returns in Pakistan, they may be based more on speculative motives. Our results suggest that in the absence of a strong institutional and regulatory framework, economic policies have only a limited effect on stabilizing an emerging market.

Additional evidence on inflation variability: The experience of asian countries

Abstract The relationship between inflation and its variability has been examined by using time series data for eight Asian Countries. It is found that this relationship also holds for countries which have enjoyed a period of long price stability. Furthermore, this relationship also holds for highly industrialized countries.