Employment Outcome of Financial Development and FDI: Empirical Findings on Pakistan

This research looks into (FND) on unemployment of Pakistan. Yearly observations of secondary data are used in the study for the period from 1980 to 2024. The Auto Regressive Distribution Lag (ARDL) technique is used to evaluate the regression result. FND, GDP growth, Foreign Direct Investment (FDI), and literacy rate are tested to have effects on unemployment. Long run relationship is found between FND and unemployment. The long run coefficient results indicate that FND and FDI alone are positively associated with unemployment. Regression results ascertained that a joint effect of FND and FDI is significantly negative on unemployment. This study suggested that FND and FDI are important factor to solve the problem in the Pakistan economy. For the policy prospect, this study recommends to create concentrated policies for attracting FND and FDI with significant potential to abolish unemployment.