The Effects of Foreign Direct Investment and International Trade on Economic Growth: An Evidence from Pakistan

Abstract

This search investigates the correlation linking global trade and FDI and economic expansion. Time series data from 1999 to 2023 were used during the analysis. The model has been empirically studied using econometric and statistical techniques. The data comes from WDI department. Given toward the findings, when statistics stationarity is established applying the Augmented Dickey Fuller Unit root test, stationarity econometric techniques like autoregressive distributed lag have yielded inconsistent results. The model was constructed with GDP as the conditional relative variable and IM, EX, and FDI as the descriptive variable quantity. All the variables have a strong short-term correlation. FDI, exports, and GDP eventually suffer. Government ought to contribute to giving investors worldwide security. When investors increase their investments, economic growth should outpace the growth of exports.