Open AccessForeign Inflows and Poverty in Pakistan: A Quantitative Approach
Author(s) -
Muhammad Zahir Faridi,
Khawaja Asif Mehmood,
Ali Azam
Publication year - 2019
Publication title -
review of economics and development studies
Language(s) - English
Resource type - Journals
eISSN - 2519-9706
pISSN - 2519-9692
DOI - 10.26710/reads.v5i1.291
Subject(s) - poverty , economics , granger causality , causality (physics) , foreign capital , affect (linguistics) , development economics , capital (architecture) , macroeconomics , foreign direct investment , econometrics , economic growth , geography , sociology , physics , communication , archaeology , quantum mechanics
Foreign Inflows (FI) acquire immense importance for an open economy. Theoretical and empirical findings suggest that FI dramatically affect the economic condition of host country. Key issue in this respect is to investigate the impact of FI on poverty. The study was based on data from 1972 to 2017. It is concluded a long term relationship between poverty and FI. At large, FI do exhibit having opposite relationship with poverty. Moreover, poverty being long run macroeconomic problem does have short run causality with some of FI. Granger causality is also confirmed on some of FI and poverty. Policy recommendation is the appropriate capital allocation for the efficient restoration of the results of FI.