Abstract
This study used to test the threshold cointegration approach
to test the Roomer (1993) hypothesis of sacrifice ratio in case
of Pakistan for economic growth, inflation rate and exchange
rate using time series data between 1981q1:2016q4. It has
been concluded that, there is sacrifice ratio but it differs as in
less persistent regime to high persistent regime. In less
persistent regime economic growth showing positive
sacrifice ratio; as both economic growth and inflation are
positively linked but on the other hand, in high persistent
regime the sacrifice ratio contradicts. There is negative
association and sacrifice ratio is -0.169 as per quarter. This is
the cost of slowing down the economic growth to check the
inflation in the economy
Umer Hussain, S. M. Naeem Nawaz. (2017) Roomer Hypothesis of Sacrifice Ratio: Asymmetric Analysis in Case Of Pakistan, Paradigms , Vol 11, Issue 2 .
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