An analysis of Pakistan's vulnerability to economic crisis

Safdar Ullah Khan, Omar Farooq Saqib

Research output: Contribution to journalArticleResearchpeer-review

2 Citations (Scopus)

Abstract

The objective of this study is to analyse the vulnerability of Pakistan's economy to crisis by evaluating the sustainability of its external and fiscal positions in the recent past. Following the emergence of current account deficits and fiscal imbalances in the last two fiscal years, scepticism about the sustainability of these fundamentals has grown. Therefore, this study uses Masson's (1999) model of contagion to find the degree of susceptibility of Pakistan's economy to crisis through assessing its external position, and Bohn's (1998) fiscal sustainability regressions to evaluate its fiscal position. Our findings are that the Pakistani fundamentals do not present an adverse scenario as its external balances signal low probability of crisis and its fiscal balances have remained sustainable both in the long run and in the recent past.

Original languageEnglish
Pages (from-to)597-609
Number of pages13
JournalPakistan Development Review
Volume46
Issue number4
Publication statusPublished - 1 Dec 2007
Externally publishedYes

Fingerprint

economic crisis
Pakistan
vulnerability
sustainability
economics
current account
economy
deficit
scenario
regression
analysis

Cite this

@article{61ec1fbecd3247d09ea9dbe1bfa3d213,
title = "An analysis of Pakistan's vulnerability to economic crisis",
abstract = "The objective of this study is to analyse the vulnerability of Pakistan's economy to crisis by evaluating the sustainability of its external and fiscal positions in the recent past. Following the emergence of current account deficits and fiscal imbalances in the last two fiscal years, scepticism about the sustainability of these fundamentals has grown. Therefore, this study uses Masson's (1999) model of contagion to find the degree of susceptibility of Pakistan's economy to crisis through assessing its external position, and Bohn's (1998) fiscal sustainability regressions to evaluate its fiscal position. Our findings are that the Pakistani fundamentals do not present an adverse scenario as its external balances signal low probability of crisis and its fiscal balances have remained sustainable both in the long run and in the recent past.",
author = "Khan, {Safdar Ullah} and Saqib, {Omar Farooq}",
year = "2007",
month = "12",
day = "1",
language = "English",
volume = "46",
pages = "597--609",
journal = "Pakistan Development Review",
issn = "0030-9729",
publisher = "Pakistan Institute of Development Economics",
number = "4",

}

An analysis of Pakistan's vulnerability to economic crisis. / Khan, Safdar Ullah; Saqib, Omar Farooq.

In: Pakistan Development Review, Vol. 46, No. 4, 01.12.2007, p. 597-609.

Research output: Contribution to journalArticleResearchpeer-review

TY - JOUR

T1 - An analysis of Pakistan's vulnerability to economic crisis

AU - Khan, Safdar Ullah

AU - Saqib, Omar Farooq

PY - 2007/12/1

Y1 - 2007/12/1

N2 - The objective of this study is to analyse the vulnerability of Pakistan's economy to crisis by evaluating the sustainability of its external and fiscal positions in the recent past. Following the emergence of current account deficits and fiscal imbalances in the last two fiscal years, scepticism about the sustainability of these fundamentals has grown. Therefore, this study uses Masson's (1999) model of contagion to find the degree of susceptibility of Pakistan's economy to crisis through assessing its external position, and Bohn's (1998) fiscal sustainability regressions to evaluate its fiscal position. Our findings are that the Pakistani fundamentals do not present an adverse scenario as its external balances signal low probability of crisis and its fiscal balances have remained sustainable both in the long run and in the recent past.

AB - The objective of this study is to analyse the vulnerability of Pakistan's economy to crisis by evaluating the sustainability of its external and fiscal positions in the recent past. Following the emergence of current account deficits and fiscal imbalances in the last two fiscal years, scepticism about the sustainability of these fundamentals has grown. Therefore, this study uses Masson's (1999) model of contagion to find the degree of susceptibility of Pakistan's economy to crisis through assessing its external position, and Bohn's (1998) fiscal sustainability regressions to evaluate its fiscal position. Our findings are that the Pakistani fundamentals do not present an adverse scenario as its external balances signal low probability of crisis and its fiscal balances have remained sustainable both in the long run and in the recent past.

UR - http://www.scopus.com/inward/record.url?scp=69949186833&partnerID=8YFLogxK

M3 - Article

VL - 46

SP - 597

EP - 609

JO - Pakistan Development Review

JF - Pakistan Development Review

SN - 0030-9729

IS - 4

ER -