Among the developing countries, Pakistan experienced a unique downward trend in rupee value and frequent transitions in the exchange rate systems. These distinctive features make Pakistan economy an interesting case study for the empirical examination of the rupee exchange rate and its role in the monetary policy and macroeconomic performance. The purpose of the present study is to find out which of the macroeconomic indicators has led the Pak-rupee exchange rate volatility during the study period. Furthermore, the effect of the exchange rate volatility on foreign exchange reserves and selected macroeconomic variables has also been studied in the framework of a regression approach. Time series annual data covering the period of 1980 to 2014 has been used for the empirical analysis. Augmented Dickey Fuller test has been used for checking the unit root in the data. Ordinary Least Squares method is used for the estimation of regression equations. For avoiding the problems of spurious relationship between the variables and series implications for the standard errors, various diagnostic tests have been applied. Initially study has taken exchange rate as dependent variable and some selected macroeconomic variables as independent variables. The result show that exchange rate has negative relationship with the variables such as inflation (INF), foreign direct investment (FDI), imports (IMP) and positive with GDP per capita (PCGDP) and exports (X), which is also supported by the theory and results. As there is two-way relationship between exchange rate and several macroeconomic variables, some selected macroeconomic variables are taken as dependent variables and exchange rate as independent variable. The results show that exchange rate volatility has negative impact on foreign exchange reserves (FOREX), and imports (IMP) and positive on GDP per capita (PCGDP) and exports (X). On the basis of the findings, it has been recommended that foreign factors in addition to the domestic factors should also be taken into account for the stability of exchange rate. Moreover, instead of targeting the monetary aggregates, the State Bank of Pakistan should follow a rule based monetary policy where exchange rate fluctuations should also be taken into account. Moreover, instead of devaluations of rupee for increasing exports, the government is required to follow import substitution policies. Furthermore, to increase the inflow of foreign exchange reserves in the country, the development of export sector of the country can play an important role.

No abstract

No abstract

The objective of the study is to estimate the determinants of price stickiness or flexibility. Data is collected through structured questionnaire from 342 firms, which are selected through stratified random sampling technique from the Industrial Estate of Khyber Pakhtunkhwa. To estimate the determinants of price flexibility/rigidity, models are estimated through ordinary least squares technique and binary logistic technique. The most important factors for price stickiness are implicit/explicit price contracts and minimum price volatility. Imperfect competitive market structure, number of regular customers, backward-looking behavior, and credibility of central bank and size of the firm are important determinants of price rigidity. While economic literacy and information set regarding expected inflation make the prices flexible. Study recommend that monetary policy of Pakistan should use other transmission channels of money supply instead of traditional channel, because it is found that the degree of price rigidity is low in Pakistan. Keywords: Price Rigidity, Price Flexibility, Price Contract, Frequency of Price Change.

To evaluate the mental wellbeing of the general population in districts of Khyber Pakhtunkhwa (KP) province of Pakistan using the World Health Organization-Five (WHO-5) well-being index. METHODS: WHO-5 well-being index questionnaire was used to document the mental well-being of individuals from thirteen most populous districts from seven divisional administrations of KP province. A rural-urban sample within these districts was estimated on the basis of proportional allocation method. The towns, villages and households in the selected districts were chosen through systematic random sampling technique by dividing the total households by the sample size. The mean score for the province was calculated and compared it to each district's scores and to the rural-urban scores. RESULTS:Out of 500 households, 303 (60.6%) were from rural and 197 (39.4%) from urban areas. Mean WHO-5 wellbeing scores was 14.60±2.65, 14.38±2.75 & 14.81±3.13 for province, urban and rural areas respectively. Higher scores reflecting better quality of life in various life domains was reported for Swabi (18.20±3.201), Haripur (18.00±2.98) and Abbottabad (17.64±3.39). Lowest scores were reported from Bannu (10.6±2.716), Charsadda (11.5±2.89) & Dera Ismail Khan (12.03±3.25) districts. Higher score for urban areas was reported from Swabi (19.8±3.243), Nowshehra (17.77±3.10) & Haripur (17.44±2.760), while for rural areas in Abbottabad (19.42±3.729), Haripur (18.33±3.01) & Mardan (17.70±3.284) districts. CONCLUSION: Mental well-being is higher for people living in Swabi, Haripur, & Abbottabad and lower for residents of Bannu, Charsadda & Dera Ismail Khan districts. Further research is required to study the contributing factors for lower mental well-being in these districts.