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• Open Access Article

  14 Pages Download PDF: Extending Okun's Law to encompass the governance-unemployment nexus: New Insights from PMG/ARDL Approach

  Extending Okun's Law to encompass the governance-unemployment nexus: New Insights from PMG/ARDL Approach

  Muhammad Umar Farooq, Abdul Majeed Nadeem, Qasim Ali

  2025-06-29 https://doi.org/10.36923/jcmi.v6i1.636

  This study has empirically aimed at estimating the short-and long-term dynamics of financial and institutional factors with respect to the unemployment rate in the case of the selected developing economies over the period of 1996-2023. The second-generation empirical analyses, such as cross-sectional dependence and unit-root analysis, support the use of pooled mean group regression analysis. The empirical outcomes of the pooled mean group regression have confirmed the existence of Okun’s law in the influence of a rise in control of corruption, government effectiveness, and political stability to reduce the unemployment rate in this region. Among the financial factors, the economic growth-unemployment rate nexus significantly validates the existence of Okun’s law. Further, the exchange rate is also highly significant in decreasing the unemployment rate in this region. However, the negative impact of the interest rate and the positive effect of broad money growth are surprisingly significant in affecting the unemployment rate and contradict the literature. Surprisingly, the institutional factors are more responsive to the unemployment rate compared with financial indicators. These outcomes suggest important policy implications regarding institutional and financial factors to control the unemployment rate in these economies

  pp. 68-81 Abstract views:187 Downloads:273

• Open Access Article

  18 Pages Download PDF: Analyzing the Influence of Post-2018 Macroeconomic and Bank-Specific Indicators on Banking Sector Profitability: Evidence from Pakistan

  Analyzing the Influence of Post-2018 Macroeconomic and Bank-Specific Indicators on Banking Sector Profitability: Evidence from Pakistan

  Muhammad Iqbal, Muhammad Munir Ahmad, Naeem Raza, Muhammad Tayyeb Hafeez

  2025-06-27 https://doi.org/10.36923/jcmi.v6i1.643

  This study examines the impact of macroeconomic and bank-specific indicators on the profitability of Pakistan’s banking sector, focusing on the volatile post-2018 period. Using return on assets (ROA) as the performance metric, it analyzes data from 20 commercial banks between 2018 and 2023. Panel data regression, conducted via Gretl software, reveals that these internal factors—Capital Adequacy Ratio (CAR), Spread Ratio (SR), and Earnings per Share (EPS)—positively and significantly influence ROA, while Firm Size (SZ) has a significant negative effect. In contrast, macroeconomic indicators like Exchange Rate (EXR), GDP, and Policy Rate (POLR) show insignificant negative relationships, and Inflation (INF), Foreign Exchange Reserves (FXRV), and Cash Equivalents (CEQU) have insignificant positive effects. These findings highlight that bank-level factors play a more critical role than external economic conditions in determining profitability. The study recommends that bank managers focus on operational efficiency and

  pp. 119-136 Abstract views:216 Downloads:118