Exports LED Growth:A Case Study of Pakistan

Abstract

Impact of exports on economic development remain an interesting topic for the economist. International trade expresses the economic growth of any nation (Marshall, 1890). According to one more economist Nurkse world business is engine of growth (1961). Bhagwati in 1973 stated that efficiency in trade and its international expansion can be obtained through free trade of services as well as goods. Empirical studies have proven a positive and significant relationship between economic development and exports of any country. Therefore, economist pay more focus on expansion of exports in order to develop the economy of the country. In addition, for expansion of exports, it is not compulsory that country blessed with a large scale of natural resources can only obtain this. But countries with less resources may also enhance the exports through effective policy making. Bhagwati and Krueger are of the view that liberalization of exchange can be obtained by arrangement which declines the opposing force to fare inclination. Edwards in 1993 expressed that fare grants, import duties with addition of exchange bends as liberal exchange administration.  An extensive variety of the studies gives confirmation that the openness of the exchange administration has a positive companionship with GDP development (Ahmed and Anoruo (2000), Edwards (1998), Edwards (1992), Harrison (1996), Iscan (1998), Wacziarg (2001), Yanikkaya (2003). In perspective of above conflicting discoveries, it is better to reevaluate this issue in the connection of Pakistan economy. Researchers are more interested in tentative relationship between investment enlargement and exchange plainness.