Production, Social Accounting and Financial Social Accounting Multiplier Analyses with the Financial Social Accounting Matrix of Pakistan Production, social accounting and financial social accounting multiplier analyses with the financial social accounting matrix of Pakistan
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This paper uses the production, social accounting and financial social accounting multiplier models to identify the key sectors and institutions of Pakistan economy that could accelerate the overall economic growth. The production multiplier model indicates that there exist strong macro-linkages among agriculture, manufacturing and electricity, gas and water supply sectors in Pakistan. It is also found that the impact of change in export on output is stronger than the impact of change in domestic demand. The results of the linkage analysis show that the manufacturing sector has strong backward linkages while construction has strong forward linkage in the economy. Thus, any injection in these sectors would have far reaching effects on economic growth in the country. The social accounting multipliers show that the effect of government transfer to the households is more than the effect of government transfer to the non financial firms. The financial social accounting multipliers show a strong impact of increase in government savings on resource availability, while the resource requirement is very high when there is an increase in physical investment by the government. For a sustainable growth in the country, there is a high need for increased physical investment by the non financial firms in the economy.
- Forum of international development studies
Forum of international development studies (33), 209-227, 2007-03
Graduate School of International Development, Nagoya University