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This paper examines possible ways for a developing country to finance budget deficits from domestic resources. It does so by analyzing Pakistan's National Savings Scheme (NSS). The NSS has a number of unusual attributes, and its impact upon the economy of Pakistan is not clear, but given Pakistan's chronic fiscal difficulties, the NSS is of great importance in financing the public sector deficit. We use an econometric model to analyze the relationship between the demands for NSS deposits and various other financial instruments, in particular, bank deposits, and foreign-currency deposits. We conclude that NSS and bank deposits are net substitutes, as are NSS and foreign-currency deposits. Bank deposits and foreign-currency deposits, however, seem to be neither substitutes nor complements. Also, the estimated income elasticity of the demand for bank deposits is negative, while that of foreign-currency deposits is positive, and that of NSS is not significantly different from zero. Finally, there is evidence that foreign-currency deposits are a net substitute for NSS deposits. Thus, there is some empirical evidence that foreign currency deposits have absorbed part of the demand for NSS deposits. Accordingly, the availability of foreign-currency deposits may have reduced the ability of the government to finance itself.

Banks and Banking --- Budgeting --- Macroeconomics --- Public Finance --- Financial Markets and the Macroeconomy --- Fiscal Policy --- Economic Development: Financial Markets --- Saving and Capital Investment --- Corporate Finance and Governance --- Banks --- Depository Institutions --- Micro Finance Institutions --- Mortgages --- Debt --- Debt Management --- Sovereign Debt --- National Budget --- Budget Systems --- Macroeconomics: Consumption --- Saving --- Wealth --- Banking --- Public finance & taxation --- Budgeting & financial management --- Bank deposits --- Government debt management --- Budget planning and preparation --- Government debt planning --- Private savings --- Financial services --- Public financial management (PFM) --- National accounts --- Banks and banking --- Debts, Public --- Budget --- Saving and investment --- Pakistan

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The conventional growth-accounting approach to estimating the sources of economic growth requires unrealistically strong assumptions about the competitiveness of factor markets and the form of the underlying aggregate production function. This paper outlines a new approach utilizing nonparametric derivative estimation techniques that does not require imposing these restrictive assumptions. The results for East Asian countries show that output elasticities of capital and labor are different from the income shares of these factors, and that the growth of total factor productivity over the period 1960-95 has been an important factor in the overall growth performance of these countries.

Econometrics --- Labor --- Macroeconomics --- Production and Operations Management --- Semiparametric and Nonparametric Methods --- Measurement of Economic Growth --- Aggregate Productivity --- Cross-Country Output Convergence --- Economywide Country Studies: Asia including Middle East --- Production --- Cost --- Capital and Total Factor Productivity --- Capacity --- Labor Economics: General --- Wages, Compensation, and Labor Costs: General --- Estimation --- Aggregate Factor Income Distribution --- Labour --- income economics --- Econometrics & economic statistics --- Total factor productivity --- Labor share --- Estimation techniques --- Income --- Econometric analysis --- National accounts --- Industrial productivity --- Labor economics --- Wages --- Econometric models --- Hong Kong Special Administrative Region, People's Republic of China