Globalization: Information Technology and Economic Growth Nexus: Empirical Evidence from ARDL Model Approach to Co-integration and Causality Analysis

Abstract

This study provides a realistic examination of link between economic growth, information technology and its elements with particular attention on the stock market advancement in Pakistan.  Our results recommend a positive connection between well-organized stock market and economic growth equally in long run and short run. In financial theory globalization information technology would affect the increase economic development. This study investigates the influence of globalization and economic advancement on income disparity in Pakistan. In this study, we used the annual time series data and also used autoregressive distributed lag model (ARDL) econometric technique. We collected this data 1973 to 2014 from state bank of Pakistan and international financial statistics. From this study, it is decided that, globalization information technology has substantial effect on income parity; the economic growth rate is also achieving the income equality. In the policy outlook trade openness, foreign payment, foreign direct investment, may contribute in reducing inequality, the key variables used in this study are like savings, inflation, and exchange rate, gross domestic product, investment. This implies that, if this country wants to increase the economic growth, then to formulate and strictly implement some particular policies that facilitate investment in ICT.