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This article aims to analyze the effect of formal and informal financing on the growth of cottage industry firms in village Islampur in Swat one of the districts of Khyber Pakhtunkhwa Pakistan. Primary data were collected through Focused Group Discussions (FGD) and a total of 208 cottage industry firms were surveyed. Robust Regression techniques were employed to analyze the data. The results show that informal financing has a higher impact than formal financing on the growth of the small firms in the study area. There is a tendency for informal borrowing among the small size firms' owners due to the fact that access to formal sources is hindered by a multitude of factors including high interest rate, complex application procedure, and demand for a collateral among others. On the contrary, we find that in case of large size firms, formal financing has a significant influence on firms' growth for cottage industry. Moreover, in co‐financing where the ratio of informal is greater than formal financing has a significant positive effect on the firm's growth. The findings of the study have implications for devising loan policies of the financial institutions to take into account these factors. The financial institutions need to come up with packages that meets the need of the small and medium enterprises.

The current study aims to investigate the effect of devaluation on a bilateral trade balance between China and the United States. The study uses monthly data for the period 20‐11‐2018, which is seasonally adjusted through the Seasonal Trend Decomposition using Loess (STL) method. The dependent variable used in this study is exports to import ratio, and the independent variable is the exchange rate. The study uses both linear and nonlinear ARDL methodology to trace the long run and short run effect and to trace the asymmetry between exports to imports ratio and exchange rate. Moreover, the long‐run relationship is established through Bound testing approach. The findings favor the devaluation for China trade balance both in the short run and long run. Moreover, the results do not support the existence of J‐curve and indicate that rather than devaluation it is the competitiveness of Chinese goods and services that provide an edge in bilateral trade between China and United States.