FISCAL ADJUSTMENT AND DYNAMIC ECONOMICS PERFORMANCE: THE CASE OF MALAYSIA

The main objective of this study is to identify the link between fiscal adjustment and dynamic economic performance in Malaysia using time series data for entire period of 1980-2009. To examine the long-run relationship between fiscal adjustment and economic performance, this has study employed the Gregory-Hansen cointegration approach to capture the endogenous structural breaks in long-run equilibrium relationship with three different specifications. The finding of this study indicates that there is long-run positive cointegration relationship between fiscal adjustment and economic performance in Malaysia. Therefore, the finding of this study clearly shows that the dynamic and continuous economics performance is a key element of the successful of the stability of Malaysia’s economic in Southeast Asian region, although have faced several economic crisis.Fiscal adjustment, Economic performance, Gregory-Hansen

Does tourism sustain the economic growth? A wavelet based evidence from United States

This study explores the relationship between tourism development and economic growth in high tourist arrival country such as the United States of America (USA) by adopting the wavelet transform approach using monthly data over the period 1996M01-2015M08. Three innovative techniques that are continuous wavelet, wavelet coherence power spectrum and wavelet based Granger causality that consider the decomposition of time-series at different time frequencies, are utilized to conduct the study. The results of autoregressive distributed lag and combine cointegration tests show that there is a significant long-run relationship occurs between tourism development and economic growth in USA. Furthermore, the results indicate that there is a unidirectional causal influence of economic growth on tourism development in the short-run whereas, in the long-run the opposite causal relationship is evident in USA. Thus it can be recommended that government needs to increase and promote tourism demand and further providing and nurturing the expansion of tourism supply with the advancement of economic growth

Return of education and retirement age decision: a case study among management graduates from Malaysia

In this study we propose a simulation approach using Cost and Benefit Analysis (CBA) to evaluate effects of the increase in retirement age on education return among tertiary management graduates in Malaysia. All data are computed into CBA model using simulation approach to measure the Internal Rate of Return (IRR) once the retirement age is increased yearly. The overall findings of this study show that the IRR is not sensitive to the assumption made about the retirement age decisions; and the IRR does not change from the compulsory retirement age proposed by the Malaysian government. Therefore, the 56 years for retirement age for management graduates in Malaysia is still ideal in term of education return

Returns to investment on tertiary education: the case of non-conventional business and management graduates

This study provides estimates of the private returns of tertiary nonconventional education (NCE) for management graduates in Malaysia. The term 'non-conventional education' used in this research refers to distance learning and part-time management degree program graduates. We evaluate the private returns using the basic concept of educational cost and benefit analysis. The data used were derived from alumni dataset from Universiti Putra Malaysia (UPM) and National University of Malaysia (UKM) alumni division. Calculating the private returns of lifetime earnings, we find that the internal rates of return for NCE graduates are similar in both public and private sectors. Nevertheless, the results presented in this study are the first approximation ever of the private rate of returns to NCE in Malaysia, based on surveys on management NCE graduates in the Malaysian labor market. This study also seeks to contribute to the existing knowledge of economic analysis on lifelong learning in Malaysia

Does Crude Oil Price, Financial Development, and Trade Openness Reflect on African Oil-Rich Countries’ Economic Growth?

This study investigates empirically the long- and short-run impact of crude oil price and financial globalization on economic growth and financial development in selected oil-rich African countries. The data usage covers 1980 to 2021 by applying the autoregressive distributed lag (ARDL) modeling to determine the short- and the long-run estimates, and the ARDL-ECM Granger causality to discover the causalities direction. The empirical results reveal that crude oil price and financial globalization have no significant effect on restructuring the economic sustainability patterns in either the long or the short run. There are various causality directions found for those countries involved in this study within the short- and long-run periods. This study recommends that the Republic of Congo and Nigeria should always maximize oil revenue during periods of oil price boom to offset the economic severity during periods of oil price reduction. Further, Algeria and Nigeria’s policymakers should avoid protectionism against financial globalization, economic growth, and trade to mobilize the resources required to be at the fulcrum of future economic restructuring. The empirical findings will be useful for policymakers to design a suitable growth model for African countries that highly depend on crude oil resources as an engine of economic growth

Evaluating the exchange rate and commodity price nexus in Malaysia: evidence from the threshold cointegration approach

This paper examines the long- and short-run dynamics of asymmetric adjustment between the nominal exchange rate and commodity prices, namely oil, palm oil, rubber, and natural gas prices, in Malaysia using monthly data from January 1994 to December 2017. The relationship between exchange rate and each commodity price is examined in terms of Engle-Granger and threshold cointegrations. The estimated results provide evidence of long-run threshold cointegration and show that the adjustments towards the long-run equilibrium position are asymmetric in the short run. Furthermore, this study finds evidence of a unidirectional causal relationship running from the nominal exchange rate to oil price in the long and short run using a spectral frequency domain causality application. There is also empirical evidence of bidirectional causality between the nominal exchange rate and palm oil price, rubber price, and natural gas price in the long and short run. Overall, the findings have significant implications for the current debate on the future of primary commodities in Malaysia

Tourism Development Policy, Strategic Alliances and Impact of Consumer Price Index on Tourist Arrivals: The Case of Malaysia

Many studies have shown the importance of tourism industry in enhancing trade performance and economic development. This study examines the hypothesis of ‘economic-driven’ tourism growth in Malaysia by using econometric modelling. To generate the empirical analysis, this study used data from 1980-2007 to analyze the economic-driven tourism growth by using vector autoregressive (VAR) estimation. The long-run relationship between specific variables is considered using the Johansen and Juselius cointegration analysis. Finally, Granger-causality results implies causal relationship of economic-driven tourism growth in Malaysia. Therefore, this study suggests policies and strategies to overcome the importance of economic-driven tourism in Malaysia in the future

The Effect of Green Taxation and Economic Growth on Environment Hazards: The Case of Malaysia

This paper explores how carbon taxation and economic growth affect environment hazards in Malaysia using time series data over the period of 1974-2010. We applied cointegration and causality approaches to determine long term and the direction of causal relationship between these variables. Based on the results, we found the cointegration relationship between the variables. Furthermore, we noted that Kuznets’ theory i.e. inverted-U shaped curve between economic growth and CO2 emissions is valid for Malaysia but the carbon taxation policy is ineffective to control CO2 emissions. The causality analysis revealed that there is bidirectional relationship is found between carbon tax and CO2 emissions. Economic growth Granger causes CO2 emissions and carbon tax is Granger cause of economic growth. To enhance the awareness on pollution issues governments should rely on alternative instruments, which may give benefit not only to taxpayers but also to reduce pollution, which is the pivotal issue to be tackle globally

Tourism Development Policy, Strategic Alliances and Impact of Consumer Price Index on Tourist Arrivals: The Case of Malaysia

Many studies have shown the importance of tourism industry in enhancing trade performance and economic development. This study examines the hypothesis of ‘economic-driven’ tourism growth in Malaysia by using econometric modelling. To generate the empirical analysis, this study used data from 1980-2007 to analyze the economic-driven tourism growth by using vector autoregressive (VAR) estimation. The long-run relationship between specific variables is considered using the Johansen and Juselius cointegration analysis. Finally, Granger-causality results implies causal relationship of economic-driven tourism growth in Malaysia. Therefore, this study suggests policies and strategies to overcome the importance of economic-driven tourism in Malaysia in the future

The Effect of Urbanization, Affluence and Trade Openness on Energy Consumption: A Time Series Analysis in Malaysia

This paper investigates the impact of urbanization on energy consumption by applying the Stochastic Impacts by Regression on Population, Affluence and Technology (STIRPAT) in case of Malaysia. The study covers the time period of 1970Q1-2011Q4. The unit root test and the ARDL bounds testing approach have been applied to examine integrating properties and long run relationship in the presence of structural breaks. Our results validated the existence of cointegration and exposed that urbanization is a major contributor in energy consumption. Affluence raises energy demand. Capital stock boosts energy consumption. Trade openness leads affluence and hence increases energy consumption. The causality analysis finds that urbanization Granger causes energy consumption. The feedback effect is found between energy consumption and affluence and, energy consumption and capital. The bidirectional causality exists between trade openness and energy consumption