STATISTICAL STUDY OF IMPACT OF SERVICES ON BALANCE OF PAYMENT IN PAKISTAN

Abstract

This study focuses upon the economic analysis of the influence of different export (E) and import (I) services on Pakistan balance of trade (BOT). Numerous statistical approaches are employed to evaluated the quarterly data of Pakistan from January, 2005 to June 2014. These techniques include Augmented Dickey Fuller (ADF) test, stepwise regression and variance inflation factor (VIF) to examine the influence of export and import of services upon the balance of payment (BOP) of Pakistan. The data stationarity is examined by employing ADF test. The findings revealed that the financial services (E), other business services of E and I have significant impact on the BOP in Pakistan. There is positive relationship of Other business services (E) and financial services (E) with BOT while other business services (I) have a negative relationship with BOP in Pakistan.