Economic and Non-Economic Determinants of Private Investment: A Case Study of Pakistan
Author: Umar Farooq

Considering the significance of private investment in Pakistan economy, this study examines the economic and non-economic determinants of private investment using annual data from 1973 to 2009. Our empirical analysis is based on Autoregressive Distributed Lag (ARDL) methodology due to Pesaran et al.(2001).The results indicate that real income, ratio of private sector credit to Gross Domestic Product, real exchange rate, public investment and real interest rate are the significant long run determinants of private investment in Pakistan. While, among the non-economic factors, it is only violence which exerts significant negative impact on private investment, the effects of other factors on private investment such as corruption and political instability remain insignificant in the long run. However, short run dynamics suggest that in addition to economic determinants of private investment, non-economic determinants such as corruption, political instability and violence appear to hinder the private investment significantly in Pakistan. Supervisor : Dr. Muhammad Arshad Khan

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Keywords : Economic and Non-Economic, Economic and Non-Economic Determinants, Pakistan, Private Investment
Supervisor: Muhammad Arshad Khan

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