The Impact of Public and Private Investment on Economic Growth of Pakistan

Abstract

However, Investment explained as the basic tool for increasing the economic growth of any nation, and further it stands for enhancing the capital stock of country; and also numbered as the basic component of the economic growth because sustainable economic growth uttered an impossible without increasing investment. Specifically, investment consisted of two types including the first private investment and second public investment whereas both investments comprised of their marginal productivity. The purpose of this research aimed to evaluate the influence of the private and public investment on GDP growth rate with the special reference to Pakistan. For this research, the annual time series data employed to cover the period from 1975 to 2018. According to stationary test of data the OLS used for estimation because all variables counted as the stationary at level. Both investments narrated as an important for increasing economic growth in country. The findings proved that both investment (i.e., private & public) have significantly positive influence on economic growth of Pakistan. The research study proposed that the both kinds of investment should be complementary not substitute to each other.