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the normality, identity, and the heterogeneity of the variables.

Sample Size:

Sample size is yearly data from 1970 to 2007. There are secondary data and statistical inferences are being made from the secondary data. Self-finding secondary data used from different libraries and digital source at the internet. The secondary date is also authentic and secondary data reasonably representative profile of whole country. In the study of the economics there is also a limitation of the sample size because of the secondary data collection.

Theoretical Framework to be used

The most contemporary approach to increase employment is to increase investment apart from economic expansionary policies. The imperative and immediate solution is to promote foreign direct investment in order to increase employment. FDI give the impression of being at the matter of prosperity. Neo classical economic theory of FDI is that there is a positive relationship between foreign direct investment and the economic growth because FDI bring capital in an economy as well increase quality and quantity. Theory also addresses the increase of revenue for government by taxation, reduce balance of payment pressure, transfer of technology, increase infrastructure for the host country.

Whereas dependency theory tells us FDI is harmful in long term prospective. The developed countries often become wealthier by using resources. The last but not the least theory of industrialization on FDI tells us FDI is not only transfer of capital it’s a package in which technology, capital, management are combined.

Variables to be studied

Foreign direct investment, employment, white collar jobs, blue collar jobs, and the gross domestic product

Sources of Information

State Bank of Pakistan’s Library and its statistics department

United Nations conference on trade and development (UNCTAD)

World Bank World Development Indicators, adjusted to 2000 base.

Instrument/s of Data Collection

State Bank of Pakistan Library

Digital libraries of renowned institution like World Bank, International Monetary Fund (IMF), and United Nation (UN) etc.

CHAPTER 4: ANALYSIS AND RESULT

Following type of models are applied after taking log for each variable because of heterogeneity, normality and identity.

Dependent Independent

Log employment = Log FDI

Log white collar jobs = Log FDI

Log blue collar jobs = Log FDI

Log GDP = Log FDI

Log employment = Log GDP

Why double log has been taken in the model

In the research model development normality, heterogeneity, and identity issues were being address by exploring each variable. In the process of the test of normality two types of test are well know Kolmogorov-Smirnov Test and the Shapiro-Wilk Test. In this study the sample size is less than the 50 years so that Shapiro-Wilk Test is more appropriate for small sample size of the research. For this reason, study is using the Shapiro-Wilk test as our numerical means of assessing normality. If the Sig. value of the Shapiro-Wilk Test is greater the 0.05 then the data is normal. If it is below 0.05 then the data sign