This study extends the analysis of causality by Husain and Rashid(2006) by taking care of the shift in the variables due to the price hikes in the early 1970s. We investigate the causal relations between real money and real income, between nominal money and nominal income, and between nominal...

In this paper, the purchasing power parity, uncovered interest rate parity and random walk component are nested in a single equation and tested for Pakistan. The autoregressive distributed lag framework is used to recover the underlying parameters of exchange rate expectations formation. The...

We develop a structural econometric model of import demand for Pakistan, with binding foreign exchange constraint. ARDL and DOLS techniques are used to estimate the log-run coefficients of price and income elasticities. The empirical results from ARDL bound testing approach and Johansen’s...

In this paper, the size of the informal economy of Pakistan is determined by including the legal and political-institutional variables as determinants. By using the MIMIC model average estimate for the informal economy of Pakistan is 37.75 percent from 1995 to 2017. The study tries to explore...

We develop a structural econometric model of import demand for Pakistan, with binding foreign exchange constraint. ARDL and DOLS techniques are used to estimate the log-run coefficients of price and income elasticities. The empirical results from ARDL bound testing approach and Johansen’s...