Analyzing Short-Run and Long-Run Causality between FDI Inflows, Labor Productivity and Education in Pakistan


Ayesha Serfraz

Abstract


This study empirically analyzes the causal relationship between FDI inflows, labor productivity and education in case of Pakistan using time series data from 1971-2016. The present study concentrates only on labor productivity since Pakistan is a labor abundant country where provision of education is solely the responsibility of Government of Pakistan. For empirical analysis, it uses the latest test for measuring causality i.e., Breitung-Candelon Granger Causality test in frequency domain (both old and new versions). The traditional approach of Johansen Cointegration test has also been applied to check robustness of results. Both versions of BC test, i.e., Breitung and Candelon (2006) and Breitung and Schreiber (2016) suggest a univariate causality running from FDI to labor productivity only, whereas Johansen Cointegration approach suggests a long run relationship among three variables. Therefore government of Pakistan must give proper attention to education sector in order to gain maximum benefits from FDI inflows.

Keywords


FDI inflows, Labor productivity, Education, Causality, Pakistan.

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About this article

Title

Analyzing Short-Run and Long-Run Causality between FDI Inflows, Labor Productivity and Education in Pakistan

Keywords

FDI inflows, Labor productivity, Education, Causality, Pakistan.

DOI

10.20448/journal.501.2018.51.36.59

Date

2018-01-30

Additional Links

Manuscript Submission

Journal

Asian Journal of Economics and Empirical Research
Vol 5, No 1 (2018) Page: 36-59

Print ISSN

2518-010X

Online ISSN

2409-2622

Statistics

62 Views | 64 Downloads

Citations

0

Authors & Affiliations

Ayesha Serfraz
Assistant Professor at University of the Punjab, Lahore
Pakistan


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Asian Journal of Economics and Empirical Research

 Online ISSN: 2409-2622 | Print ISSN: 2518-010X

 

 

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