This paper develops an open economy dynamic stochastic general equilibrium (DSGE) model based on New-Keynesian micro-foundations. Alongside standard features of emerging economies, such as a combination of producer and local currency pricing for exporters, foreign capital inflow in terms of...

This paper examines the prospects of expanding bilateral trade between Pakistan and China particularly in the context of the recently signed free trade agreement between the two countries. Using the augmented gravity model in the tradition of Rose (2004), the paper shows that there is...

This paper investigates the impact of foreign aid, external debt and governance on the economic growth by extending the Ramsey–Cass–Koopman's growth model in an open economy framework. Steady-state and short run analysis shows that external debt and foreign aid do not affect the growth rate...

Interest spread of Pakistan s banking industry has been on the rise for the last two years. The increase in interest spread discourages savings and investments, on the one hand, and raises concerns about the effectiveness of the bank-lending channels of monetary policy, on the other. This study...

This paper explores the role of public investment in the process of economic growth, in the context of Pakistan’s economy, using the vector autoregressive approach (VAR). Based on theoretical considerations, the model also includes private investment and public consumption besides public...

This paper analyses monetary policy transparency of the central bank (SBP) using the Eijffinger and Geraats (2006) index. The results show that the SBP scores 4.5 out of 15, which is lower than any of the central banks’ score in Eijffinger and Geraats (2006). The SBP is completely opaque on...

This paper examines the export-led growth hypothesis for the five largest economies of the South Asian region using a multivariate time-series framework. The South Asian countries present an interesting case study in view of their increasing outward orientation and adoption of export promotion...

This paper examines the efficiency of the large-scale manufacturing sector of Pakistan using parametric as well as non-parametric frontier techniques. Production frontiers are estimated for two periods-1995-96 and 2000-01-for 101 industries at the 5-digit PSIC. The results show that there has...