Impact Of Macro-Economic Variables On Foreign Direct Investment In Pakistan

Authors

  • Hamza Feroz MPhil Scholar, School of Economics, Quaid I Azam University, Islamabad
  • Imad Khan Department of Economics, University of Swat, Pakistan
  • Nafees Ahmad Department of Economics, University of Malakand, Pakistan
  • Rabia Majeed Department of Economics, Pakhtunkhwa Economic Policy Research Institute (PEPRI), Abdul Wali Khan University Mardan, Khyber Pakhtunkhwa, Pakistan

Abstract

Pakistan is engaging and competing to pull in outside direct investment into its economy. The study shows the effect of Inflation, Exchange Rate, Trade openness on FDI Inflows in Pakistan. The objective of this research paper is to examine the effects of various economic factors on Foreign Direct Investment (FDI) inflow into Pakistan. For econometric analysis time series data from 2000 to 2021 have been used. Log linear regression model and the method of Least Square were used as an analytical tool for the empirical estimation. The result show that FDI is a negative relationship Exchange rate and Inflation rate. The result further shows the relation between FDI and Trade openness have significant and positive relationship. To enhance desirable amount of FDI into Pakistan, the least square estimates suggests that the government make sure constant economic environment, provide a well-established infrastructure, encourage domestic investment, minimizing external debt burden, provide fiscal and financial incentives, and consistency in the government policy.

Keywords- Macro-Economic, Foreign Direct Investment & Pakistan

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Published

2024-11-21

How to Cite

Hamza Feroz, Imad Khan, Nafees Ahmad, & Rabia Majeed. (2024). Impact Of Macro-Economic Variables On Foreign Direct Investment In Pakistan. Journal of Social Signs Review, 2(4), 109–128. Retrieved from https://socialsignsreivew.com/index.php/12/article/view/40

Issue

Vol. 2 No. 4 (2024): Journal of Social Signs Review (OCT-DEC-ISSUE)

Section

Articles