Economic Development and Growth

Leonard Fong Litt Lam (University Putra Malaysia)) · Siong Hook Law · W. N. W. Azman-Saini · Normaz Wana Ismail ·Millennial Asia ·2022

This article analyses the importance of high-technology trade as a channel of economic growth to ease Malaysia out of the middle-income trap. This study also wonders upon the missing absorptive capabilities that validate the likelihoods of dismal gross domestic product (GDP) growth since the 1990s. Using the autoregressive distributed lag (ARDL) approach and fully modified ordinary least squares (FMOLS) estimator as robustness checks, this study identifies the determinants of high-technology trade and the appropriate absorptive capability in enhancing economic growth. The empirical results from quarterly data from 1990 to 2015 proved that foreign direct investment, financial development and infrastructure are vital to develop a successful high-technology trade. Another important finding is that it validates the presence of trade openness (as absorptive capability) in order to magnify the benefits of research and development (R&D). This explains why, despite spending on R&D, these spending do not project to economic growth.

Raja Nor Firdaus Kashfi Raja Othman · Nurfaezah Abdullah · Amiruddin Ahamat · Nor Aishah Md Zuki · Fairul Azhar Abdul Shukor · Kasrul Abdul Karim ·Journal of Open Innovation: Technology Market and Complexity ·2019

In the last few years, the monstrous fan has gained attention in this country for large space buildings and areas. The continuity of this product technology is important to allow it to be able to survive in the current and future market. However, there are limited studies on the present and future scenario of the monstrous fan, especially in Malaysia. Thus, the objective of this paper is to forecast its present technology, evaluating the market demand and future of the monstrous fan. For these reasons, an online survey was used to obtain feedback from suppliers and manufacturers to forecast the future of this product. In conclusion, the monstrous fan has been discussed and predicted, which can be beneficial for various parties including policy makers, government, business and technology players by representing a specific knowledge on the technical specificities of monstrous fans in Malaysia.

Suhal Kusairi · Suriyani Muhamad · Norizan Abdul Razak · Aji Purba Trapsila ·Journal of Asian Finance, Economics and Business ·2021 ·JEL: D21, D23, M13, M14

This study examines the impact of Information and Communication Technology (ICT) and the role of Malaysian local wisdom called “Ugahari” in managing Work–Life Balance (WLB) during the COVID-19 pandemic in Malaysia. Data was obtained through online and offline surveys which were distributed to the agencies in the public and private sectors spread across Kuala Lumpur, Selangor and Pura Jaya. Overall 466 respondents were found to have given valid and complete responses. This research utilized the Partial Least Squares Structural Equation Modelling. It was found that the use of the ICT during Work from Home (WFH) helped workers to have relatively high flexibility where they could easily expand or contract one domain to meet the demands of another domain. At the same time it also offered high permeability where aspects of one domain entered another domain. This encourages workers to integrate their roles and achieve broad work autonomy. Furthermore, this situation then gives rise to a high level of interference at the boundary between work and family domains. On the other hand Ugahari reduces the level of interference caused by ICT use and encourages workers to compartmentalize their respective roles. Thus, ICT and Ugahari’s behavior can play a role and complement each other in the context of realizing worker well-being

Guohui Chen · Jie Zhang ·Emerging Markets Finance and Trade ·2022

The ASEAN countries are in a golden stage of development, although the uneven regional development remains a prominent challenge to integrated growth. The study tries to investigate regional inequality in ASEAN countries from an outer space perspective. It first estimates the relationship between nighttime light intensity and GDP per capita for the 10 ASEAN countries at the national level, based on which it predicts regional incomes at the subnational level to assess regional inequality and explores the affecting factors. The results indicate that regional inequality in the ASEAN region and economic development present an inverted N-shaped relationship. The overall inequality of the region is largely attributed to the uneven development between countries. It is also found that transportation, urbanization, openness, mineral rents, and tax revenue are all significantly relevant to regional inequality.

Kunal Sen · Matthew Tyce ·Structural Change and Economic Dynamics ·2019

Both Malaysia and Thailand were seen to be part of the miracle growth economies of East Asia and fast moving into high income status in the early 1990s. Following the Asian Financial Crisis (AFC) of the mid 1990s, both countries have observed prolonged growth slowdowns. In this paper, we offer a political economy explanation of the growth slowdown in Malaysia and Thailand in their post AFC phases. We argue that the nature of the political settlement in these two countries determined a growth strategy that was predicated on offering open deals in the export-oriented manufacturing sector that were accessible to most firms, while at the same time, offering closed deals to politically connected firms in the natural resource and services sectors. As the political settlement moved to a vulnerable authoritarian one in both countries, such a dualistic deals strategy became patronage based over time and detrimental to growth.

Muhammed Abdul Khalid · Li Yang ·Journal of Asian Economics ·2021

In this paper, by combining information obtained from national accounts, household surveys, and fiscal data, we document the evolution of income inequality in Malaysia, not only at the national level (for the period of 1984–2014) but also by ethnic group (for the period of 2002–2014). To our knowledge this is the first attempt to produce inequality measurements of Malaysia, which are fully consistent with the national accounts. Our research shows that despite Malaysia’s exceptional economic growth rate, its growth has been inclusive. For the period of 2002–2014, the real income growth for the bottom 50 % is the highest (5.2 %), followed by the middle 40 % (4.1 %), the top 10 % (2.7 %) and then the top 1 % (1.6 %). However, while average growth rates are positive across all ethnic groups (Bumiputera 4.9 %, Indians 4.8 %, and Chinese 2.7 %), the highest growth of real income per adult accrued to the Bumiputera in the top 1 % (at 8.3 %), which sharply contrasts the much lower growth rate of the Indians (at 3.4 %) and negative income growth rates of the Chinese (at −0.6 %). Despite the negative growth rate, the Chinese still account for the lion’s share in the top 1 %. In 2014, 60 % of the adults in the top 1 % income group are Chinese, while 33 % Bumiputera, and 6 % Indians. We conclude that in this period, Malaysia’s growth features an inclusive redistribution between income classes, but with a twist between racial groups.

Joseph Deutsch · Jacques Silber · Guanghua Wan · Mengxue Zhao ·Journal of Asian Economics ·2020 ·JEL: D31 – I31

Using data on household consumer durables from the Asian Barometer Survey, this paper examines the evolution of inequality, poverty and welfare in six countries of South East Asia: Cambodia, Indonesia, Malaysia, the Philippines, Thailand and Vietnam. We start by deriving the most common order of acquisition of these durables, using first an algorithm proposed by Paroush (1965), and then Item Response Theory. We also compute the frequency distribution of the number of durables owned by households. We then use these results to compute inequality, poverty and achievement or welfare indices adapted to the case of ordinal variables. Our empirical results confirm the existence of an order of acquisition. The results show that inequality was higher in Cambodia, Indonesia and the Philippines and lower in Vietnam, Thailand and Malaysia. A similar classification of countries was obtained when computing multidimensional poverty indices. Finally, using the welfare or achievement index recently introduced by Apouey et al. (2019), we found that welfare was generally higher in Vietnam, Thailand and Malaysia and lower in Cambodia, Indonesia and the Philippines

Abdul Rahim Ridzuan · Shahsuzan Zakaria · Bayu Arie Fianto · Nora Yusma Mohamed Yusoff · Nor Fatimah Che Sulaiman · Mohamad Idham Md Razak · Siswantini · Arsiyanti Lestari ·International Journal of Energy Economics and Policy ·2021 ·JEL: G10, F62

This study offers new insights for policymakers to reduce income inequality, thus ensuring economic growth which greatly benefits the poor segment of population and directing financial sector to provide easy access to financial resources for lower income group at cheaper cost. Bound test was applied to examine the long-run and short-run relationships based on the sample period beginning from 1970 until 2016. The results confirmed the existence of a long-run relationship between the variables. Financial development in Malaysia, Indonesia and Thailand had successfully reduced income inequality, however, a different effect was recorded in the Philippines where income distribution was worsened. Furthermore, economic growth brought positive effect to income distribution in Malaysia and Indonesia, but not for Thailand and the Philippines. Inflation, trade openness and foreign direct investment, provided mixed results for all countries. Among the policies recommendation for this paper are there should be more easy accessibility for entrepreneurs to reach the wide range of financial services including conventional and Islamic financial products, the expansion of capital market, as well as giving proper attention to the financial sector. Besides, granting the access to capital markets for low income groups or underprivileged individuals might be helpful to them either by developing entrepreneurial skill or involvement in productive activities and receive better salaries. This policy will give insight to the policymakers to strengthen their financial institutions, especially during the pandemic of Covid-19