[go: up one dir, main page]
IDEAS home Printed from https://ideas.repec.org/p/pid/wpaper/2016143.html
   My bibliography  Save this paper

Growth Diagnostics: Pakistan

Author

Listed:
  • Idrees Khawaja

    (Pakistan Institute of Development Economics, Islamabad)

  • Sajawal Khan

    (State Bank of Pakistan, Karachi)

Abstract
This study investigates critical constraints to growth in Pakistan using Hausmann, Rodrik and Valesco’s (2005) decision-tree methodology. The investigation is supplemented by macro-level and firm-level regression analysis. The critical constraints identified using the three set of identifications include; poor institutional quality/poor governance, little foreign inflows, bad financial intermediation, difficult access to finance, macroeconomic instability, shortage of energy and poor labour quality as the critical constraints to growth. Joining the pieces of evidence apparent from the three set of investigations yields poor institutional quality as one mega constraint—constraints like macroeconomic instability, little and expensive energy, poor labour quality, bad financial intermediation and lack of access to finance, all seem to be rooted in poor institutional quality. We also identify various institutions of Pakistan that seemingly constrain growth in the country. These include institutions related to ; plea bargain offered by the National Accountability Bureau to those charged with corruption, institution for creation of provinces, NFC, political finance, SROs, post-fecto approval of supplementary budget, bureaucracy, local government, medium of instruction and the institution for holding population census timely.

Suggested Citation

  • Idrees Khawaja & Sajawal Khan, 2016. "Growth Diagnostics: Pakistan," PIDE-Working Papers 2016:143, Pakistan Institute of Development Economics.
    • Handle: RePEc:pid:wpaper:2016:143
    as

    Download full text from publisher

    File URL: https://www.pide.org.pk/pdf/Working%20Paper/WorkingPaper-143.pdf
    File Function: First Version, 2016
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Micheline Goedhuys & Leo Sleuwaegen, 2010. "High-growth entrepreneurial firms in Africa: a quantile regression approach," Small Business Economics, Springer, vol. 34(1), pages 31-51, January.
    2. Robin Marris & Adrian Wood (ed.), 1971. "The Corporate Economy," Palgrave Macmillan Books, Palgrave Macmillan, number 978-1-349-01110-0, March.
    3. Robert Cressy, 2006. "Why do Most Firms Die Young?," Small Business Economics, Springer, vol. 26(2), pages 103-116, March.
    4. Aterido, Reyes & Hallward-Driemeier, Mary & Pagés, Carmen, 2007. "Investment Climate and Employment Growth: The Impact of Access to Finance, Corruption and Regulations Across Firms," IZA Discussion Papers 3138, Institute of Labor Economics (IZA).
    5. Marcela Meléndez Arjona & Arturo Harker Roa, 2008. "Revisiting economic growth in Colombia. A microeconomic perspective," Working Papers Series. Documentos de Trabajo 9137, Fedesarrollo.
    6. Nadeem Ul Haque, 2007. "Entrepreneurship in Pakistan," PIDE-Working Papers 2007:29, Pakistan Institute of Development Economics.
    7. Naci Mocan, 2008. "What Determines Corruption? International Evidence From Microdata," Economic Inquiry, Western Economic Association International, vol. 46(4), pages 493-510, October.
    8. Abdul Qayyum & Idrees Khawaja & Asma Hyder, 2008. "Growth Diagnostics in Pakistan," PIDE-Working Papers 2008:47, Pakistan Institute of Development Economics.
    9. Gaviria, Alejandro, 2002. "Assessing the effects of corruption and crime on firm performance: evidence from Latin America," Emerging Markets Review, Elsevier, vol. 3(3), pages 245-268, September.
    10. Caves,Richard E., 2007. "Multinational Enterprise and Economic Analysis," Cambridge Books, Cambridge University Press, number 9780521677530, September.
    11. Reinikka, Ritva & Svensson, Jakob, 2002. "Coping with poor public capital," Journal of Development Economics, Elsevier, vol. 69(1), pages 51-69, October.
    12. Miroslav Mateev & Yanko Anastasov, 2010. "Determinants of small and medium sized fast growing enterprises in central and eastern Europe: a panel data analysis," Financial Theory and Practice, Institute of Public Finance, vol. 34(3), pages 269-295.
    13. Becchetti, Leonardo & Trovato, Giovanni, 2002. "The Determinants of Growth for Small and Medium Sized Firms: The Role of the Availability of External Finance," Small Business Economics, Springer, vol. 19(4), pages 291-306, December.
    14. Nadeem Ul Haque, 2007. "Entrepreneurship in Pakistan," Microeconomics Working Papers 22190, East Asian Bureau of Economic Research.
    15. Carmen Pagés-Serra & Reyes Aterido & Mary Hallward-Driemeier, 2007. "Investment Climate and Employment Growth: The Impact of Access to Finance, Corruption and Regulations Across Firms," Research Department Publications 4559, Inter-American Development Bank, Research Department.
    16. Robert E. Carpenter & Bruce C. Petersen, 2002. "Is The Growth Of Small Firms Constrained By Internal Finance?," The Review of Economics and Statistics, MIT Press, vol. 84(2), pages 298-309, May.
    17. Caves,Richard E., 2007. "Multinational Enterprise and Economic Analysis," Cambridge Books, Cambridge University Press, number 9780521860130, September.
    18. Rajan, Raghuram G. & Zingales, Luigi, 2003. "The great reversals: the politics of financial development in the twentieth century," Journal of Financial Economics, Elsevier, vol. 69(1), pages 5-50, July.
    19. Cheema, Ali & Khwaja, Asim Ijaz & Qadir, Adnan, 2005. "Decentralization in Pakistan: Context, Content and Causes," Working Paper Series rwp05-034, Harvard University, John F. Kennedy School of Government.
    20. repec:idb:brikps:76944 is not listed on IDEAS
    21. Mr. Klaus-Stefan Enders, 2007. "Egypt—Searching for Binding Constraints on Growth," IMF Working Papers 2007/057, International Monetary Fund.
    22. Kwo-Shin Chen & Emerson M. Babb & Lee F. Schrader, 1985. "Growth of large cooperative and proprietary firms in the US food sector," Agribusiness, John Wiley & Sons, Ltd., vol. 1(2), pages 201-210.
    23. Domenico Sarno, 2008. "Capital structure and growth of the firms in the backward regions of the south Italy," Applied Financial Economics, Taylor & Francis Journals, vol. 18(10), pages 821-833.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Idrees Khawaja & Nasir Iqbal, 2019. "Determinants of Expansion of Micro and Small Firms and State of Entrepreneurship in Pakistan," PIDE-Working Papers 2019:160, Pakistan Institute of Development Economics.
    2. Marco Vivarelli, 2013. "Is entrepreneurship necessarily good? Microeconomic evidence from developed and developing countries," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 22(6), pages 1453-1495, December.
    3. Vivarelli, Marco, 2012. "Drivers of entrepreneurship and post-entry performance : microeconomic evidence from advanced and developing countries," Policy Research Working Paper Series 6245, The World Bank.
    4. Vivarelli, Marco, 2012. "Entrepreneurship in Advanced and Developing Countries: A Microeconomic Perspective," IZA Discussion Papers 6513, Institute of Labor Economics (IZA).
    5. Francesco Quatraro & Marco Vivarelli, 2015. "Drivers of Entrepreneurship and Post-entry Performance of Newborn Firms in Developing Countries," The World Bank Research Observer, World Bank, vol. 30(2), pages 277-305.
    6. Reeg, Caroline, 2015. "Micro and small enterprises as drivers for job creation and decent work," IDOS Discussion Papers 10/2015, German Institute of Development and Sustainability (IDOS).
    7. Sucre Reyes, M.A., 2014. "Finance, growth and social fairness : Evidence for Latin America and Bolivia," Other publications TiSEM ad514338-1973-4ec9-b5c7-2, Tilburg University, School of Economics and Management.
    8. T. Dinh, Hinh & Mavridis, Dimitris A. & Nguyen, Hoa B., 2010. "The binding constraint on firms'growth in developing countries," Policy Research Working Paper Series 5485, The World Bank.
    9. Francesca Gagliardi, 2009. "Financial development and the growth of cooperative firms," Small Business Economics, Springer, vol. 32(4), pages 439-464, April.
    10. Miroslav Mateev & Yanko Anastasov, 2010. "Determinants of small and medium sized fast growing enterprises in central and eastern Europe: a panel data analysis," Financial Theory and Practice, Institute of Public Finance, vol. 34(3), pages 269-295.
    11. Enrico Santarelli & Marco Vivarelli, 2007. "Entrepreneurship and the process of firms’ entry, survival and growth," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 16(3), pages 455-488, June.
    12. Christina E. Bannier & Sabrina Zahn, 2014. "SMEs' Growth Heterogeneity - Evidence from Regional Developments," International Journal of Business Administration, International Journal of Business Administration, Sciedu Press, vol. 5(2), pages 23-49, March.
    13. Nakhoda, Aadil, 2014. "The impact of electricity constraints on access to finance: A firm-level study," MPRA Paper 59507, University Library of Munich, Germany.
    14. Marco Vivarelli, 2012. "Entrepreneurship and Post-Entry Performance: the Microeconomic Evidence," DISCE - Quaderni del Dipartimento di Scienze Economiche e Sociali dises1286, Università Cattolica del Sacro Cuore, Dipartimenti e Istituti di Scienze Economiche (DISCE).
    15. Preeya S. Mohan, 2019. "Necessity Versus Opportunity Motivation: Nascent Firm Performance In Caribbean Small Island Developing States," Journal of Developmental Entrepreneurship (JDE), World Scientific Publishing Co. Pte. Ltd., vol. 24(04), pages 1-22, December.
    16. Ruohan Wu, 2019. "Firm Development and Bribery: An Empirical Study from Latin America," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 47(1), pages 53-64, March.
    17. Hinh T. Dinh & George R.G. Clarke, 2012. "Performance of Manufacturing Firms in Africa : An Empirical Analysis," World Bank Publications - Books, The World Bank Group, number 11959.
    18. Francesco Quatraro & Marco Vivarelli, 2013. "Entry and Post-Entry Dynamics in Developing Countries," GREDEG Working Papers 2013-20, Groupe de REcherche en Droit, Economie, Gestion (GREDEG CNRS), Université Côte d'Azur, France.
    19. Kwamena Minta Nyarku & Stephen Oduro, 2017. "Examining the Effect of Corruption and Bureaucracy on SMEs Growth in the Kumasi Metropolis of Ghana," Proceedings Paper, in: Munyoki, Justus & Bode, Jürgen (ed.), Universities, Entrepreneurship and Enterprise Development in Africa - Conference Proceedings 2017, volume 6, pages 154-173, Universities Entrepreneurship and Enterprise Development in Africa International Conference.
    20. Quatraro, Francesco & Vivarelli, Marco, 2013. "Entrepreneurship In A Developing Country Context," Department of Economics and Statistics Cognetti de Martiis LEI & BRICK - Laboratory of Economics of Innovation "Franco Momigliano", Bureau of Research in Innovation, Complexity and Knowledge, Collegio 201314, University of Turin.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pid:wpaper:2016:143. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Khurram Iqbal (email available below). General contact details of provider: https://edirc.repec.org/data/pideipk.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.