Measuring the Impact of Total Revenue, Total Labor Force and Oil Prices on Economic Growth of Pakistan

Abstract

This study establishes the empirical relationship between GDP and total revenue, total labor force and oil prices. Numerous studies concluded profound impact of these variables on GDP of Pakistan as well as other economies. In this study, all the sources of revenue generating including tax and non-tax revenue and financial aid and grants are included. In total labor force, both male and female labor force are included. The impact of oil prices on GDP is also included in the model. This study is conducted to measure the impact and significance of these variables on GDP of Pakistan for years 1970-2012 using time-series data. Regression analysis results shows significant concluded coefficients. Unit root test verified the stationarity of the data. The results of co-integration test show long run association between the GDP and the independent variables. The empirical results conclude positive impact of total revenue, total labor force and negative impact of oil prices on GDP of Pakistan.