Economic Growth and Protection of Life, Property and Contracts by Dr. Shabib Haider Syed, Forman Christian College (A Chartered University), Lahore
- 1. Economic Growth and Protection of Life, Property and Contract. Shabib Haider Syed Zahid Iqbal Luqman Saeed Rabia Saeed
- 2. Problem Statement Pakistan faces two major challenges, how to establish and sustain democracy and how to stimulate and sustained growth? These two issues can be bridged through the quality of its institutions. The quality of institutions not only ensures the sustainability of democracy but also determines its long run economic growth. The adverse institutional structure hinders sustained growth.
- 3. Objectives Compilation, construction and analysis of time series data on terrorism, crime and suicide. To estimate the impact of terrorism, crime and suicide on economic performance.
- 4. Objectives Achieved Literature Review Institutions, Terrorism, Crime and Suicide. Data
- 5. Literature Review Study Objectives Data Main findings De Long and Schleifer Impact on Institutions on City expansion 1050-1800 Positive Impact of Non Absolutist governments (1993) Medieval Europe Knack and Keefer Institutions 1974-89, 97 countries, Positive Impact of Institutions (1995) ICRG, BERI, Gastil Alesina et al (1996) Political Instability 113, 1950-82 Negative impact of government collapse on Propensity of Government collapse Development Knack and Keefer Institutions, ICRG, BERI Positive Impact (1998) Convergence Acemoglu and Relative importance of Country risk services, Polity IV Property rights have stronger impact. Ronbinson (2003) property and contarct rights Gerring et al (2005) Impact of democracy on Polity 2, Polity IV Positive impact of democracy on development development
- 6. Literature Reivew Enders and Sandler (1996) Impact of terrorism on FDII, 13.5, 11.9 percent decrease Spain and Greece in Spain and Greece Abadie & Gardaezabal(2003) Economic impact of terrorism on 1968-2000 -10 % PCI, Basque region Bloomberg, Hess & Orphanides Macro-economic consequences of Panel data T –PCI (2004) terrorism 177 countries G crowds in, I crowds out. 1968-2000 Barth et al (2006) Impact of terrorism on growth and T – growth and capital capital formation Crain and Crain (2006) Economic impact of terrorism Panel data Unanticipated level of incidents 147 countries most significant. 1968-2002 Abadie and Gardeazabal (2007) Terrorism Impact on FDI - Impact on FDI Gaibulleov and Sandler (2006) Economic Impact of terrorism in Panel Data -Growth. South Asia. 42 Countries 1970-2004 GTD significant predictor of investment. Gaibulleov(2010) Economic impact of terrorism 1970-2007 No significant relation Tayab et al (2011) Impact of terrorism on financial Time Series- Primary data KSE index affected significantly markets of Pakistan for terrorism. 2006-08
- 7. Literature Review Londono and Guerrero (2000) Direct cost of violence 7 percent of GDP in Venezuela Buvinic and Morrison (2000) Cost of Violence in Latin Health, 0.3 to 5 percent of GDP, America Policing, 2 to 9 % of GDP Anderson (2009) Cost of crime in US Per capita crime burden US $ 4118.42 Loureiro and Delfino Silve (2010) Cost of Violence - Investment and growth Rincke (2010) 5 incidents per 1000 pop, 0.5 percent reduction In earnings. Detotto and Otranto (2010) Impact of crime on Reduces growth by 0.0004 growth percent
- 8. Data Terrorism (GTD and SATP) Crime (Major categories) Suicide (Punjab and Sindh completed. Baluchistan and Khybar Pakhunkhwa completed since 2000)
- 9. Terrorism Trend Terrorism Trend (1981-2010) 6000 Lal Masjid 5000 Baluch Insurgency 4000 Incidents 3000 Casualties 2000 Afghan Jihad final Wana Operation Clean-up 9/11 phase 1000 Sectarian 0 1981 1984 1987 1990 1993 1996 1999 2002 2005 2008
- 10. Descriptive Statistics Years Incident Wounde Killed Casualti Casualti Mean Coefficie s d es es per Incidenc nt of incidenc e Variation e 1980-89 186 1467 303 1770 9.5 23.25 146.88 1990-99 1977 4338 2405 6743 3.4 198.36 39.30 2000-10 3264 12997 13727 26724 8.1 331.8 78.93 1981- 5427 18802 16435 35237 6.49 200.16 98.36 2000
- 11. Per capita income and terrorism growth rate
- 12. Methodology α α1 α2 α3 α4 α5 Yt =At(K ,L ,Tar ,Sui ,Cri ,CIM ) t t t t t t LogYt =LogAt+α LogK t +α 1LogL t +α 2 LogTart +α 3LogSui t +α 4LogCri t +α 5 LogCIM t + µ t
- 13. Preliminary Results Variables Coefficients C 1.196 Log of Capital 0.224*** Log of Labor 0.201* Log of Openness 0.056 Log of Secondary School Enrollment 0.111** Log of Incidents -0.015*** Log of Lagged Per capita income 0.390*** ***, ** and * shows significance level of one, five and ten percent respectively.
- 14. Challenges Due to unavailability of data prior to 2000, time series data of suicide is being constructed through newspapers. This is the first comprehensive data on suicide in Pakistan since 1980. Data cleaning and validation is taking time.
- 15. Way forward Data on Suicide (KPK and Baluchistan prior 2000) Estimation and Analysis
Editor's Notes
- #2: Transaction cost