NATURAL RESOURCES AVAILABILITY AND UNEMPLOYMENT IN PAKISTAN: THE ROLE OF TRADE OPENNESS

Abstract

Natural resources include oil, gas, minerals, forests, water, and fertile land. Efficient utilization can boost economic growth, employment, and trade. This study investigates the empirical outcomes of natural resources utilization and population growth on unemployment of Pakistan. The time-series data from 1972 to 2023 has been consider for empirical investigation. Unemployment rises when there is underutilization of resources, economic instability, or poor trade policies. The unemployment rate taken as a dependent variable in the estimated model and the independent variable included such as financial development, population growth, trade openness, and natural resources agglomeration. For empirical inquiry, we use the autoregressive distributed lag model (ARDL) for co-integration. The outcomes show that financial developments have an inverse and significant effect on the unemployment in Pakistan. The rural population has positive, while the urban population hurts unemployment opportunities. For the open economy, trade openness has a positive effect on unemployment. Furthermore, empiric reveals that the index of natural resources has an inverse and significant relation with unemployment. For policy purpose, the government of Pakistan can reduce unemployment with the help of improvement and modernized our agro sector at first stage. This strategy may improve rural employment and it may leads to grow the agro base industries on later stage. Agro-based industrialization can potentially mitigate unemployment associated with open trade by creating new job opportunities in rural areas and diversifying the economy.