Foreign Direct Investment, Financial Development and Economic Growth in Pakistan

The objective of this study is to examine the effects of foreign direct investment and financial development on Pakistan's economic growth. We used time series secondary data for the period 1980-2018. GDP was taken a proxy variable of economic growth while independent variables included industrialization, FDI, Financial development, Exchange rate and foreign remittance. In order to check stationarity, we used KPSS and NG Person unit root test. The ARDL Approach and Error model were applied to determine long run and short run relationship between dependent and independent variables. The results show that there is positive relationship between industrialization, financial development, foreign direct investment, foreign remittance and economic growth.