THE IMPACT OF TRADE OPENNESS ON THE ECONOMY OF PAKISTAN

Abstract

The purpose of this study is to understand how trade influences the economic growth of a country by examining both the potential benefits and challenges associated with trade openness in the global market. The study aims to identify the conditions under which open trade policies are beneficial for economic growth, as well as the factors that may hinder a positive impact. It aims to study the mutual impact of trade openness on Gross domestic product (GDP) of Pakistan. Regression analysis, Ordinary least square (OLS) method is used to test whether imports and exports have significant impact on Gross domestic product or not. In this study data of imports, exports and Gross domestic product of Pakistan has been gathered from the year 2000 till 2023. Total number of observation is 23.

EViews software is used to test the data. This study shows that exports do not have a significant influence on Gross domestic product while imports have a significant impact.