Trade Liberalization, Human Capital and Industrial Performance in Pakistan
Abstract
The present study attempts to analyze the impact of trade liberalization and human capital on industrial performance in case of Pakistan. By using annual time series data of 1972-2014, study identifies the relationship between trade liberalization and industrial value-added, by applying co-integration technique. Findings of the analysis suggest that there exists positive long-run relationship between trade liberalization, human capital and industrial value-added in the economy. Industrial value-added is found to be highly elastic to human capital. Moreover, the results show that labor force and physical capital also have strong positive impact on industrial value-added. Our findings support the liberal trade policy for long-run growth of Pakistan economy.