Openness and economic growth in Pakistan

Abstract

This study examines the relationship between openness and economic growth in the context of Pakistan's economy using the Cointegration and Error-Correction framework. The empirical results suggest that openness and economic growth are cointegrated, signifying a long-run equilibrium relationship between the two variables. The results of the error-correction model indicate that while there is no short-run causality in either direction, there is strong support for long-run bi-directional causality between openness and economic growth.