Catalyzing the Impact of High Cost of Living on Demand and Supply of Textile Industry
A Prospective of Emerging Economy
DOI:
https://doi.org/10.58329/criss.v2i3.46Abstract
Abstract Views: 184
The high cost of living is unrestful for all economic agents. The shocks in the cost of living badly affect emerging economies like Pakistan. This study provides a novel analysis of the impact of “different types of living costs” on the demand and supply of the textile industry of Pakistan. It used the Structural Vector Autoregressive (SVAR) model to analyze the impact of the shocks in cost of living on textile industry demand and supply using monthly data from July 2008 to June 2020. The study's findings suggest that rising energy, housing, clothing, and footwear cost weaken demand for the textile sector, mostly through lower purchasing power. While education costs diminish supply, food costs raise producer price index, and transportation costs have no effect. Our findings contribute to the body of knowledge and give vital information on which types of living costs affect the textile sector and which might lead to improvement. The study's findings aid in the establishment of strategies for the textile industry's long-term viability and development. Furthermore, the study provides a novel insight that not all sorts of costs are detrimental to the textile industry.
Keywords:
Cost of living, Demand and supply, Textile industry
References
Ahmad, N., & Kalim, R. (2014). Implications of export competitiveness, and performance of Textile and Clothing Sector of Pakistan: Pre and post quota analysis. Pakistan Journal of Commerce and Social Sciences (PJCSS), 8(3), 696-714. https://doi.org/10.1007/s11069-012-0528-3
Arslan, A., Qayyum, A., Ayubi, S., Khan, S. A., & Asad ULLAH, M. (2022). The Impact of Energy Crisis and Political Instability on Outsourcing: An Analysis of the Textile Industry of Pakistan. The Journal of Asian Finance, Economics and Business, 9(3), 235-243.
Beckerman, W., & Jenkinson, T. (1986). What stopped the inflation? Unemployment or commodity prices? The Economic Journal, 96(381), 39-54. https://doi.org/10.1007/s11069-012-0528-3
Fardous, A. (2011, August 25-26, 2011). Economic effects of oil and food price shocks in Asia and Pacific countries: An application of SVAR Model New Zealand Agricultural and Resource Economics Society Conference, https://doi.org/10.1007/s11069-012-0528-3
Hamilton, J. D. (1983). Oil and the macroeconomy since World War II. Journal of political economy, 91(2), 228-248. https://doi.org/10.1007/s11069-012-0528-3
Hanif, M. N., & Jafri, S. K. (2008). Financial development and textile sector competitiveness: A case study of Pakistan. South Asia Economic Journal, 9(1), 141-158. https://doi.org/10.1007/s11069-012-0528-3
Hanif, M. N., Iqbal, J., & Khan, I. N. (2017). Global commodity prices and domestic inflation: A case study of Pakistan. SBP Research Bulletin, 13(1), 21-51.
Heady, D., & Fan, S. (2008). Anatomy of a Crisis. International Food Policy Research Institute.
Hussain, S. I., Hussain, A., & Alam, M. M. (2020). Determinants of export supply in Pakistan: A sector wise disaggregated analysis. Cogent Economics & Finance, 8(1), 1732072.
Imdad, H. (2023). Access to Finance for Entrepreneurs in MENA Region. CARC Research in Social Sciences, 2(1), 01-07.
Irshad, M. S., & Xin, Q. (2017). Determinants of exports competitiveness: An empirical analysis through revealed comparative advantage of external sector of Pakistan. Asian Economic and Financial Review, 6(3), 623-633. https://doi.org/10.1007/s11069-012-0528-3
Jo, S., Karnizova, L., & Reza, A. (2019). Industry effects of oil price shocks: A re-examination. Energy Economics, 82, 179-190. https://doi.org/10.1007/s11069-012-0528-3
Khan, M. A., & Ahmed, A. (2011). Macroeconomic effects of global food and oil price shocks to the Pakistan economy: A structural vector autoregressive (SVAR) analysis. The Pakistan Development Review, 491-511. https://doi.org/10.1007/s11069-012-0528-3
Khan, M. A., & Ahmed, A. (2014). Revisiting the macroeconomic effects of oil and food price shocks to P akistan economy: a structural vector autoregressive (SVAR) analysis. OPEC Energy Review, 38(2), 184-215. https://doi.org/10.1007/s11069-012-0528-3
Kilian, L., & Park, C. (2009). The impact of oil price shocks on the US stock market. International economic review, 50(4), 1267-1287. https://doi.org/10.1007/s11069-012-0528-3
Knop, S. J., & Vespignani, J. L. (2014). The sectorial impact of commodity price shocks in Australia. Economic Modelling, 42, 257-271. https://doi.org/10.1007/s11069-012-0528-3
Lee, K., & Ni, S. (2002). On the dynamic effects of oil price shocks: a study using industry level data. Journal of Monetary economics, 49(4), 823-852. https://doi.org/10.1007/s11069-012-0528-3
Maqbool, M. S., ur Rehman, M. A., ur Rehman, H., & ur Rehman, S. (2020). The Economic Analysis of Comparative Advantage and Competitiveness in the Textile Export Industry in Pakistan. Pakistan Journal of Social Sciences, 40(3), 1409-1416. https://doi.org/10.1007/s11069-012-0528-3
Miller, N., Peng, L., & Sklarz, M. (2011). House prices and economic growth. The Journal of Real Estate Finance and Economics, 42, 522-541. https://doi.org/10.1007/s11069-012-0528-3
Papapetrou, E. (2001). Oil price shocks, stock market, economic activity and employment in Greece. Energy Economics, 23(5), 511-532. https://doi.org/10.1007/s11069-012-0528-3
Raweh, B. A. A., Erbao, C., & Aloqab, A. (2023). Impact of Stock Market and Financial Development on Sustainable Development in Kuwait. CARC Research in Social Sciences, 2(1), 18-23.
Siddiqi, W., Ahmad, N., Khan, A. A., & Yousef, K. (2012). Determinants of export demand of textile and clothing sector of Pakistan: An empirical analysis. World Applied Sciences Journal, 16(8), 1171-1175.
Subhani, M. I., Habib, S., & Osman, A. (2007). Determinants of Export Performance in Textile Sector of Pakistan. South Asian Journal of Management, 1(1), 11-15.
Tang, W., Wu, L., & Zhang, Z. (2010). Oil price shocks and their short-and long-term effects on the Chinese economy. Energy Economics, 32, S3-S14. https://doi.org/10.1007/s11069-012-0528-3
Wajid, A., Almashaqbeh, H. A., AL SABI, M. S., & Raza, A. (2023). Factors Effecting On Supply Chain Management Performance in Textile Industries of Pakistan. International Journal of Social Science & Entrepreneurship, 3(2), 163-180. https://doi.org/10.1007/s11069-012-0528-3
Yasmeen, R., Shah, W. U. H., Ivascu, L., Tao, R., & Sarfraz, M. (2022). Energy crisis, firm productivity, political crisis, and sustainable growth of the textile industry: An emerging economy perspective. Sustainability, 14(22), 15112. https://doi.org/10.1007/s11069-012-0528-3
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2023 CARC Research in Social Sciences
This work is licensed under a Creative Commons Attribution 4.0 International License.
