The Pakistan Development Review
Not a member yet
2465 research outputs found
Sort by
Muhammad Irfan. Institutional Barriers to Sustainable Urban Transport in Pakistan. Karachi: Oxford University Press. 2010. xxi+298 pages. Pak Rs 795. Hardbound.
Get PDFThe mayor of Bogota, Gustavo Petro, recently hit the headlines
with his incisive comment, “A developed country is not a place where the
poor have cars. It’s where the rich use public transportation.” This
quip defines how policymakers around the world should look at the issue
of urban transport, or rather sustainable urban transport. Rapid
economic growth in the postwar period and high urbanisation combined
with a greater need for mobility have escalated problems of congestion,
noise and air pollution, and road accidents, necessitating a focus on
the sustainability of urban transport. Pakistan finds itself at the
crossroads where it has to balance the increasing demand for mobility
with environmental concerns. This book by Muhammad Irfan is an opportune
contribution
Growth and Financing Behaviour of Firms of Textile Industry in Pakistan: A Panel Data Analysis.
Get PDFHigh economic growth, extremely low nominal interest rate and
negative real interest rate gave a boost to financial leverage (gearing
ratio) of the textile sector to its peak in 2005. Firms are now are
facing the consequence of high gearing. An explosion in their financing
costs along with removal of textile quota from 2005 onwards and later on
an acute energy crisis hampered their profitability and ability to repay
their debt. This in turn contributed to non-performing loans which is
now is likely to pose a big challenge for financial sector and push
economy into another crisis. Most of the previous studies including a
very few on capital structure of Pakistani firms focus on understanding
only the firm specific determinants of financial leverage and completely
ignore macroeconomic or institutional factors. Findings of this paper
prove that all firm specific determinants including profitability and
efficiency, firms‘ growth, risk and collateral excluding size
significantly influence corporate financial leverage of textile industry
in Pakistan. All macroeconomic variables including overall economic
growth, equity market conditions and nominal cost of debt also have
significant impact on corporate gearing. Negative sign with the
composite measure of profitability and efficiency implies that banks are
compelled to fund inefficient and unprofitable firms because demand for
loans comes more from inefficient and unprofitable firms. Positive sign
with growth and negative sign with risk is indicative of the fact that
banks prefer to lend to growing rather than riskier firms. JEL
classification: C13, C23, C51, L65, G10, G30 Keywords: Capital Structure
Determinants, Corporate Financial Leverage, Corporate Gearing
Rati
Assessing Poverty with Non-Income Deprivation Indicators: Pakistan, 2008-09.
Get PDFThe approach to measure poverty in terms of financial
deprivation has been widely criticised in the literature of welfare and
wellbeing. It is argued that to understand the complex phenomenon of
poverty or to evaluate household or individual wellbeing, a
multidimensional exercise is imperative. This research quantifies the
level of multidimensional poverty in Pakistan using household data of
Pakistan Social and Living Standard Measurement Survey. Multidimensional
poverty in terms of the popular FGT (headcount, poverty gap, poverty
severity) indices is estimated for the year 2009. Indicators of human
poverty, poor housing and deprivation in household physical assets are
included in estimating poverty in multi-dimensional context. For
assessing the inter-temporal consistency in the methodology, poverty
indices are also developed for the year 2005. JEL classification: I32,
I31 Keywords: Poverty, Multidimensional, Categorical Principal Component
Analysis, Poverty Indices, Pakista
The Current Account Dynamics in Pakistan: An Intertemporal Optimisation Perspective.
Get PDFThe intertemporal approach has become a basic reference in
open economy macroeconomics for the theoretical understanding of the
current account. Since the early 1980s there has been substantial growth
in the literature using this approach to analyse the behaviour of the
current account movements for different countries and time periods. The
theoretical refinements in the approach have led most of the empirical
studies in the literature today to apply the basic present value model
of current account (PVMCA) and its extended version to examine the
fluctuations in the current account balances of both developed and
developing countries. Using data on Pakistan over the period 1960 to
2009, the present study finds that the basic model fails to predict the
dynamics of the actual current account. However, extending the basic
model to capture variations in the world real interest rate and the real
exchange rate significantly improves the fit of the intertemporal model.
The extended model predictions better replicate the volatility of
current account data and better explain historical episodes of current
account imbalance in Pakistan. JEL classification: C32, F32, F41
Keywords: Current Account, Present Value Models, Consumption-based
Interest Rate, Pakista
The Contemporaneous Correlation of Structural Shocks and Inflation-Output Variability in Pakistan
Get PDFMonetary policy has changed in a number of ways in the last
two decades. Along with other characteristics, modern monetary policy is
forward-looking and today central banks, to maintain credibility,
respond contemporaneously to structural shocks that might make inflation
deviate from the target in future. This study aims at investigating this
aspect of monetary policy for Pakistan. Using the modified version of
Structural Vector Autoregression (SVAR) developed by Enders and Hurn
(2007), the authors have found a weak policy response to supply side
shocks as the correlation coefficient between demand and supply shocks
is only 0.041. Moreover, the results show that the demand shocks have no
significant contribution in output variability. On the other hand, both
demand and supply shocks, along with foreign supply shocks,
significantly contribute to inflation variability. JEL classification:
E31, E42, E52, E58 Keywords: Monetary Policy, Contemporaneous
Correlation, Pakistan, Structural Shocks, Vector
Autoregressio
Green Growth: An Environmental Technology Approach.
Get PDFThis research is focused on achieving green growth through an
environmental technology approach. Developing environmental technology
we examined four elements considering the enforcement of intellectual
property rights (IPRs), research and development (R&D) expenditures,
the size of the market capture by GDP and most importantly the
environmental taxations. This study includes the 11 developed countries
which are Austria, Australia, Canada, France, Japan, Finland, Germany,
Sweden, U.K and U.S. Technology change can be better handled by panel
data than by pure cross-section or pure time series. It can minimise the
bias if we used the aggregate individuals or firms. Estimation
techniques depend on short panel or long panel. This study used the
Pooled Least Square estimation techniques like Fixed Effect Model (FEM)
and random effect model (REM) for both balance period of 2000-2005 and
unbalanced period from 1995-2005. The study concluded the policy
formulation in making developed‘s climate resilient economies. JEL
classification: O34, F19, L24 Keywords: Intellectual Property Rights,
Foreign Direct Investment, Technology Licensin
What Determines Innovation in the Manufacturing Sector? Evidence from Pakistan.
Get PDFThis study analysed the behaviour of a sample of manufacturing
firms in Pakistan in order to understand what determines innovative
activity employing a panel data set for the years 2002 and 2006-07.
Probit estimation results reveal that size of the firm and human
resource quality are important internal factors that increase the
likelihood of a firm innovating. Interestingly, whether a firm is
exporting or not has no bearing. However, post innovating there is a
large increase in number of firms who export. Externally, presence in a
geographic cluster is important though further analysis reveals that the
impact varies according to firm size. Size per se does not increase
likelihood of innovating for medium sized firm who only have an
advantage over small sized firms when present in a cluster. Large firms
on the other hand continue to have an advantage and the advantage
further increases with presence in a cluster. Finally, analysis by
product and process innovators reveals that the characteristics of firms
undertaking the two types of innovative activity are similar. The only
noteworthy difference being that process innovation does not benefit
from presence of a firm in a cluster which might be attributable to the
more visible nature of product innovation which benefits from
technological spillovers that are a characteristic of presence in a
cluster. JEL classifications: O14, O31, O33, L6 Keywords: Innovation and
Invention: Processes and Incentive, Developing Countries, Industry
Stud
On Measuring Inclusiveness of Growth in Pakistan.
No full textUsing social opportunity function approach, this work
assesses, firstly, the change in and access to education and employment
opportunities available to the population and secondly, how equitably
these opportunities are distributed. Opportunity Index (OI) and Equity
Index of Opportunities (EIO) are calculated to measure and quantify the
extent of progress made in these two most important socio-economic
components of development. Based on data, extracted from Pakistan Social
and Living Standards Measurement (PSLM) Surveys of 1998-99 and 2007-08,
the present work finds that growth process has resulted in increased
inequalities both in education and employment opportunities over the
study period. Average opportunities available to population increased
for education while a decline in average employment opportunities is
documented in 2007-08 as compared to 1998-99. OI registered an increase
for primary and secondary levels of education. EIO improved at primary
level, remained stagnant for secondary level and decreased for literacy
rate over the time. Moreover, EIO for employment opportunities,
suggesting equitable distribution for employment and paid employment,
registered a decrease and opportunities distribution turn inequitable
when calculated based on average monthly income earned. Findings of the
paper suggest that policies should be focused to actively engage the
marginalised groups of the society in growth process through improvement
in higher education and more equitable distribution of opportunities.
JEL classification: C46, D63, E24, I24, O12 Keywords: Inclusive Growth,
Inequality, Opportunity Curve, Opportunity Index, Equity Index of
Opportunities, Pakista
Devaki Jain and Diane Elson (eds). Harvesting Feminist Knowledge for Public Policy. Sage Publications Pvt. Ltd. 20 II. 396 pages. US$ 43.26.
No full textHarvesting Feminist Knowledge for Public Policy comprises 14
articles by feminist thinkers from all over the world, reflecting on
problems of current patterns of development and calls for political,
economic, and social changes to promote equality. In general the
articles are about the "triple crises" of food, fuel, and finance and
draw on the diversity of socioeconomic experiences of women in different
countries. The authors argue for new ways of thinking about development,
and offer ideas for reformulating development to secure social,
economic, and political justic
Macroeconomic Effects of Global Food and Oil Price Shocks to the Pakistan Economy: A Structural Vector Autoregressive (SVAR) Analysis.
Get PDFThis study examines the transmission channels through which
the global food and oil price shocks affects selected macroeconomic
variables including inflation rate, output, money balances, interest
rate and real effective exchange rate for Pakistan using monthly data
over the period 1990M1-2011M7. An empirical analysis is carried out by
employing structural vector autoregressive (SVAR) framework. Generalised
Impulse Response Functions and Generalised Forecast Variance
Decompositions are employed to track the impact of oil and food price
shocks to Pakistan‘s economy. Results suggest that oil price shock
affects industrial production, appreciates real effective exchange rate
negatively and affect inflation and interest rate positively. Whereas,
following food price shocks, industrial output increases. Similarly,
interest rate and inflation rate responds positively following food
price shocks. However, the variation in interest rate due to food price
shock is relatively larger than that of oil price shocks. Generalised
impulse response functions reveal that real effective exchange rate is
most important source of disturbances following either oil price or food
price shocks. Generalised forecast variance decompositions analysis also
supports the findings based on generalised impulse response functions.
The result clearly reveals that oil and food price shocks significantly
affect output, short-term interest rate, inflation rate and real
effective exchange rate. However, among all, real effective exchange
rate has seen a dominant source of variations in Pakistan. This implies
that supply-side and demand-side disturbances originated by external
shocks are the major sources of inflation (stagflation) in Pakistan.
Keywords: Oil and Food Price Shocks, SVAR, GIRFs, GFEVDs,
Pakista