Academy of Contemporary Research Journal

Effect of Different Factors on Gross Domestic Product:
A Comparative Study of Pakistan and Bangladesh

Shafaqat Mehmood
Resource Mentors (Pvt,) Ltd., Lahore, Pakistan

Abstract:
This study investigates the affect of thirteen selected factors (independent variables) on Gross Domestic Product (GDP) in Pakistan and Bangladesh economy, for the purpose of comparing both countries finding, to identify with reasons, which country is in better position and why? Economic growth measured in GDP by using time series data over the period 1976/77 to 2008/09 for the last thirty-four years. GDP represent the dependent variable and independent variables taken such as gross national expenditure, final consumption expenditure, goods exports & imports, services exports & imports, external debt stocks, gross saving, FDI inflows, FDI outflows, gross domestic income, net income from abroad and worker’s remittances and compensation of employees paid. This study found that in Pakistan gross national expenditures, goods exports, gross saving and final consumption expenditure have a positive effect on the GDP. But the factors such as external debts total stock and services exports have a negative effect on the GDP of Pakistan. In case of Bangladesh, this study found that factor such as gross national expenditures, external debts stock total, goods imports and exports have positive effect on the GDP of Bangladesh but the factor as final consumption expenditure has negative effect on the GDP of Bangladesh.

Keyword: GDP, Pakistan, Bangladesh, Different Factors