All Theses and Dissertations


Master of Science in Economics

Faculty / School

Faculty of Business Administration (FBA)


Department of Economics

Date of Award

Fall 2020


Dr. Adnan Haider

Committee Member 1

Dr. Adnan Haider, Institute of Business Administration, Karachi

Project Type


Access Type

Restricted Access


x, 105


In this thesis, a medium-size model of the economy of Pakistan has been specified to better understand the underlying dynamics of the Pakistan’s economy. The model has been divided into real, monetary, fiscal, supply-side, and external sector. There is a total of 45 behavioral equations in the model. Time-series data for the years 1973-2020 has been used to estimate the model. The estimation of the model is carried out using the three-stage least square method of estimation. In addition, the model has been validated using the root mean square error and mean absolute scale error. In-sample simulation of the endogenous variables has also been carried out to assess the ability of the model in tracing the time-series. Out of sample forecasts using judgmental values of various exogenous variables is also carried out for future path of the endogenous variables. Overall, the performance of the model is quite good in tracing the time path of the endogenous variables, consistent with the long-term trend of the endogenous variables.

JEL Classification: C36, C51, C52, C53, C54, E61, O21

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