Global economic resilience: Analyzing the diverse impacts of the COVID-19 pandemic on the US, Pakistan, and the world

Abstract

The economic development of a state can be accurately characterized as the measurable changes in macroeconomic indicators that result in an increase in the overall production or output over a specific timeframe, in comparison to the previous period. Several key macroeconomic factors contribute to the advancement of economic growth. These factors include the industrial production, unemployment rate, business Confidence Index, government budget deficit, and the labor force participation rate. The study employed secondary data from January 2016 to August 2023, with a monthly frequency, to estimate the coefficients. The data encompassed the United States, Pakistan, and the rest of the world. The empirical findings indicate that there exists a negative relationship between equality and economic growth in the United States, Pakistan, and other countries worldwide. The findings demonstrate that the global pandemic has had a notable impact on the industrial production of the World, the United States, and Pakistan, with an initial increase followed by a gradual decline. The unemployment rates in the United States, Pakistan, and the rest of the world have experienced a substantial decline. Simultaneously, the rate of unemployment has witnessed a notable increase, resulting in significant and adverse effects on the respective economies. The decrease in the Business Confidence Index can be attributed to heightened levels of uncertainty, which in turn have had a detrimental impact on the gross domestic product of the United States, Pakistan, and other countries worldwide. The reduction in imports has resulted in a decrease in the government budget deficit, which has had a notable impact on the economy.