Abstract
The study has examined the impact of decentralized public spending on the
economic growth of Pakistan from 1972 to 2016. For examining the stationarity of
variables, Augmented Dickey-Fuller (ADF) unit root test is used. Autoregressive
Distributed Lag Approach (ARDL) is used for cointegration among the variables
of the model. The estimated results of the study show that decentralized education
and health expenditures have positive and significant impact on economic growth
of Pakistan. Furthermore, the study shows that decentralization of education and
health expenditures is growth enhancing. On the basis of results of interaction
terms of health expenditures decentralization with political freedom, and
education expenditures decentralization with political freedom, economic
growth can be enhanced if people get more political freedom. Our results
suggest that health and education expenditures carried out by provincial
governments can be beneficial to economic growth if people have more political
rights and provincial governments have more autonomy.
Muhammad Shahid, Abdul Farooq , Ahmad Nawaz. (2018) The Impact of Decentralized Public Spending on Economic Growth: A Time Series Analysis for Pakistan, Abasyn Journal of Social Sciences, Volume-11, Issue-2.
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