A Study on the Relationship Between Security and Prosperity in Pakistan

Since 2014 Pakistan has reported improvements in their security and their economy. The aim of this study is to determine if those improvements are a result of counterterrorism policies implemented that same year, along with aggressive military operations. By utilizing a linear regression model, the hope was to identify a direct negative relationship between Pakistan’s Market Potential Index scores from 2007-2014 and their reported fiscal loss due to terrorism during the same years. If a relationship exists between those two variables, then there is an opportunity to argue that Pakistan has improved their economic situation by reducing domestic terrorism within their borders. Other research on this topic only measures Pakistan’s economic loss from acts of terrorism; there is no record of research gauging the effects of reported improvements. By studying the effects of a reduction in terrorist acts on the economic potential of Pakistan, the goal is to support increased security reform in Pakistan and international cooperation in their road to stability.