Zeeshan, Muhammad
[VerfasserIn];
han, Jiabin
[VerfasserIn];
Ullah, Irfan
[VerfasserIn];
Rehman, Alam
[VerfasserIn];
Alam Afridi, Fakhr E.
[VerfasserIn]
Terrorism, Financial Crisis, and Domestic Investment Nexus in Pakistan
Beschreibung:
This paper investigates the impact of terrorism and financial crisis on the domestic investment in Pakistan for the period 2001-2017. Pakistan became a non-NATO ally in the US war against terrorism in 2002, this strategic coalition brings enormous capital inflow on one hand and human and capital losses on the other hand. The financial crisis in 2007-08 also has adverse implications for domestic investment. We applied the autoregressive distributed lag (ARDL) cointegration approach for estimation. The empirical results suggest terrorism and financial crisis both have a negative implication on domestic investment in Pakistan, terrorism has both long run and short implications for investment while the financial crisis affects domestic investment in the short run only. Besides terrorism has a greater effect on investment as compared to financial cries on investment. This shows that terrorism and financial crisis lead to uncertainty and contract the domestic investment in Pakistan. Therefore, the government needs to improve the law-and-order situation, rehabilitate war-affected areas, in addition, State Bank also needs to provide sufficient credit to the commercial banks in order to boost up the domestic investment