Time Series Analysis of Aggregate Export Demand of Pakistan

Abstract

This study estimates the aggregate export demand in Pakistan. The secondary data from 1980 to 2018 of different variables are taken from various sources. The major trading partners are the USA, UK, UAE, China, and Germany, which contribute more than 38% in Pakistan’s exports. We employ time series analysis and autoregressive distributed lag model (Bound test). The result confirms that the real foreign income of exporting partner has positive and relative price index has a significant negative effect, and the real effective exchange rate has an insignificant negative effect on aggregate export demand of Pakistan.