European Academic Research ISSN 2286-4822
ISSN-L 2286-4822
Impact Factor: 3.4546 (UIF)
DRJI Value : 5.9 (B+)
Article Details :
Article Name :
The effects of FDI, CO2 emissions, and Inflation on Economic Growth: Evidence from Pakistan
Author Name :
ILYAS AHMAD, BILAL AHMED, ZIA UR RAHMAN
Publisher :
Bridge Center
Article URL :
Abstract :
In this article, an attempt has been made to analyze the relation and the effect of foreign direct investment together with CO2 emission and inflation on economic growth of Pakistan for the period 1971-2015. Since it’s desirable to test the impact of foreign direct investment inflow using the recent facts and figure, the study uses GDP as dependent variable while foreign direct investment, CO2, and inflation are used as independent variables. The study adopts ARDL to Cointegration methods for the empirical analysis. The empirical estimations shows that foreign direct investment has positive and significant association with economic growth which implies that foreign direct investment boost economic growth both in short and long run. The CO2 emissions have negative and significant relation with economic growth in long run but hold insignificant in short run. Increase in inflation hinders the economic growth in long run because of the negative relation between GDP and inflation. These empirical insights provide policymakers with important policy recommendations.
Keywords :
CO2 emission, Foreign direct investment, Economic Growth, Inflation.
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