DefinePK

Abstract

<jats:p>The spillover of external research and development (R&amp;D) capital stock and the level of
domestic human capital, as a source of absorptive capacity, plays a vital role in stimulating economic
growth and development. The objective of this study is to examine the asymmetric associations among
human capital, R&amp;D stock spillover, capital import intensity, and output growth in Pakistan over
the period 1982 to 2020. For this purpose, we develop and estimate a nonlinear autoregressive
distributed lag (NAR DL) model. The results of the bounds test confirm the presence of a long run
relationship, while the error correction model confirms the convergence from short run to long run
equilibrium among the variables. The impact of machinery and technological good imports is positive
on per capita GDP in the long run. In contrast, the impact of external R&amp;D capital stock is symmetric
in the short but becomes negative in the long run. The relationship between human capital and per
capita GDP appears to be asymmetric because of low spending in the education sector. Based on these
findings, we suggest that Pakistan should enhance its share of imports of high tech products and
improve its absorptive capacity for the effective use of external R&amp;D resources.</jats:p>