Interlinkages between Openness and Foreign Debt in Pakistan

Muhammad ZAKARIA

Öz


The paper empirically studies the impact of trade openness on foreign debt in Pakistan using quarterly data for the period 1972 to 2010. Generalized method of Moments (GMM) estimation technique is applied to overcome the potential endogeneity problem in the model. The study reveals a significant positive effect of trade openness on foreign debt. The results are robust to different model specifications. The results also highlight the role of other variables in determining external debt. Terms of trade, fiscal deficit and inflation significantly positively affect foreign debt; while foreign Exchange reserves and foreign direct investment have significant negative impacts on foreign trade.

Anahtar Kelimeler


Foreign Debt; Openness; GMM

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Doğuş Üniversitesi Dergisi'nin içeriği Creative Commons Atıf-Gayriticari 4.0 Uluslararası Lisansı ile lisanslanmıştır.
 

İletişim:

Doğuş Üniversitesi Dergisi
Acıbadem Zeamet Sokak, No: 21
34722 - Kadıköy, İSTANBUL
E-posta: journal@dogus.edu.tr