An Economic Analysis Of Cost Of Living And Basic Needs Budget In Malaysia

Kajian ini telah mengenal pasti faktor-faktor yang mempengaruhi kos sara hidup dan keperluan belanjawan asas bagi kumpulan pendapatan menengah di tiga buah bandar terpilih di Malaysia The study has investigated the main factors influencing the cost of living and basic needs budget of middle income in three selected capital cities in Malaysi

Cost of living and standard of living nexus: the determinants of cost of living

Cost of living and standard of living are two elements that have strong causal relationship. Determining which one causes the other would give some ideas to policy makers about mitigating the adverse impact of the rising cost of living. This study investigates whether the standard of living causes the cost of living. It further identifies the factors influencing the cost of living. Based on Malaysian data over 1980-2014, we use Toda Yamamoto causality model, to identify whether the cost of living Granger causes the standard of living or vice-versa. In identifying the factors that influence the cost of living, we use, the Autoregresive Distributed Lag (ARDL) Bounds test. The result indicates that there is evidence of unidirectional Granger causality between the cost of living and the standard of living. It addition, we found that the cost of living can be used to better predict the standard of living by considering the lagged values of the cost of living rather than the lagged values of the standard of living. The results further show that there is a long-run relationship between the cost of living and the factors of gross domestic product per capita, population growth, unemployment rate and degree of openness. PRO © 2020 Penerbit Universiti Kebangsaan Malaysia. All rights reserved

Food away from home of middle-income earners: empirical evidence from the three major cities in Malaysia

Malaysia have achieved high income growth and experienced rapid urbanization and changes in socioeconomic and demographic structure. Family income as well as demographic factors influence demand for food away from home. At the same time food service facilities also showed the rapid growth. It is expected that there will be significant changes in food away from home consumption in Malaysia. The objective of this paper is to analyse middle income household expenditure patterns on food away from home in the three major cities of Malaysia (George Town, Kuala Lumpur and Johor Bahru) that have a high cost of living. Therefore, a survey has been carried out in the three cities and the total number of observations used for the estimation was 473 observations. A censored Tobit model was applied to quantify the responsiveness of household expenditure on food away from home. The results indicate that on average, the household income and number of children below 12 years old in the household are the significant factors that affect the household expenditure on food away from home. There is a significant difference between the Chinese and Malays in their spending pattern on food away from home. Meanwhile, family size, gender and age of household head were statistically insignificant. It is recommended that the government should strengthen the enforcement of price control regulations in order to avoid high inflation in food price, as well as monitoring the quality of food served by the sellers in order to encourage people to consume healthy food

Factors influencing the basic needs budget among the middle income earners in selected major cities in Malaysia

This paper investigated the main factors influencing the basic needs budget in three major cities with a high cost of living in Malaysia. The analysis of variance tests result indicated that the Federal Territory of Kuala Lumpur, the state of Penang and Johor are places with high cost of living. The result also revealed that the middle income group are those who earn an income between RM2,992.50 to RM8,999 a month and the salaries of teachers were used as a proxy for the middle income groups. The Ordinary Least Squares (OLS) regression analysis indicated that there is a difference between the basic needs budget for single-adults and one-working parent families and furthermore, the basic needs budget in the cities of Kuala Lumpur, Johor Baharu and George Town is slightly different in each town. By and large, there is a difference in the basic needs budget between single-adults in Kuala Lumpur and Johor Bahru, and between two-working parent families among the three major cities. It is however interesting to note that there is no difference in the basic needs budgets among one-working parent families in these cities. The results also revealed that the total household income, family size, age of head of household, sex ratio, number of rooms, electrical appliances usage cost, broadband subscribers and number of privately owned cars all significantly influenced the basic needs budget regardless of which cities the respondents live

Cost of living and standard of living nexus: the determinants of cost of living

Cost of living and standard of living are two elements that have strong causal relationship. Determining which one causes the other would give some ideas to policy makers about mitigating the adverse impact of the rising cost of living. This study investigates whether the standard of living causes the cost of living. It further identifies the factors influencing the cost of living. Based on Malaysian data over 1980-2014, we use Toda Yamamoto causality model, to identify whether the cost of living Granger causes the standard of living or vice-versa. In identifying the factors that influence the cost of living, we use, the Autoregresive Distributed Lag (ARDL) Bounds test. The result indicates that there is evidence of unidirectional Granger causality between the cost of living and the standard of living. It addition, we found that the cost of living can be used to better predict the standard of living by considering the lagged values of the cost of living rather than the lagged values of the standard of living. The results further show that there is a long-run relationship between the cost of living and the factors of gross domestic product per capita, population growth, unemployment rate and degree of openness

Elasticity of demand for cellular phone network access in Malaysia

This study analyzes the elasticity of demand for cellular phone network access and the network effects in Malaysia. It uses quarterly data from 2003Q1 to 2011Q4 with 7 difference variables in two separate equations. The dependent variable is the penetration rate of cellular phone. From the analysis, we found that the penetration rates of cellular phone are strongly related to the factors highlighted in the study and all the variables are strongly significant. The F-test also suggested that the entity Fixed Effects Model (FEM) is the appropriate model and more preferred for this study. From the entity FEM analysis, all independent variables are significant. The price elasticity of demand, crossprice elasticity and income elasticity are elastic. The result also shows that the fixed-line is complementary and luxury goods to the cellular phone network in Malaysia and the networks externalities are strongly significant when we used number of subscriber as a proxy

Middle income household spending patterns on housing in Malaysian state capital cities: where does all the money go?

This paper examines the factors influencing the expenditure pattern of middle-income households on housing in selected state capital cities in Malaysia by focusing on mortgage and rental expenses. Three state capital cities were chosen (George Town in Pulau Pinang, Kuala Lumpur and Johor Bahru in Johor) and a survey was carried out with 473 observations that were used for estimations by using a censored Tobit model. The results indicate that household income is statistically significant and does indeed affect mortgages but not the rental expenses in the selected state capital cities. Moreover, there is strong evidence of a relationship between family size and the number of rooms with the mortgage and rental expenditure. The analysis also indicates that there is a different pattern of expenditure on mortgage and rental between the different ethnic groups in Malaysia. The Chinese and Indian races tend to spend more on mortgages and less on rental compared to the Malays. Further, the gender and age of household heads are found to be insignificant in terms of influencing mortgages but do affect rental expenditure. In addition, middle-income households in Johor Bahru pay more on mortgages and in Kuala Lumpur such households pay more for housing rental. It is concluded that changes in spending patterns are starkly different across state capital cities in Malaysia and mortgage repayments represent a large proportion of household expenditure

Cost of living and standard of living nexus: the determinants of cost of living

Cost of living and standard of living are two elements that have strong causal relationship. Determining which one causes the other would give some ideas to policy makers about mitigating the adverse impact of the rising cost of living. This study investigates whether the standard of living causes the cost of living. It further identifies the factors influencing the cost of living. Based on Malaysian data over 1980-2014, we use Toda Yamamoto causality model, to identify whether the cost of living Granger causes the standard of living or vice-versa. In identifying the factors that influence the cost of living, we use, the Autoregresive Distributed Lag (ARDL) Bounds test. The result indicates that there is evidence of unidirectional Granger causality between the cost of living and the standard of living. It addition, we found that the cost of living can be used to better predict the standard of living by considering the lagged values of the cost of living rather than the lagged values of the standard of living. The results further show that there is a long-run relationship between the cost of living and the factors of gross domestic product per capita, population growth, unemployment rate and degree of openness

Examining the linkages between street crime and selected state economic variables in Malaysia: a panel data analysis

In this paper, the authors use dynamic panel data in order to assess the linkages between the cost of living, income inequality, gross domestic product (GDP) per capita, population and unemployment rate with respect to the street crime rate in Malaysia. More specifically, the investigation considers whether the following could be capable of generating any difference in the crime rate observed across many types of street crime. The F-test, Breusch-Pagan Lagrange Multiplier test and Hausman tests affirm the most preferred model to explain criminal behaviour is by using Fixed Effects Model almost for all types of street crime. The findings of the estimated coefficients reveal that the cost of living is negatively related to all street crime types and not significant as well as unemployment rate. There is a motivation towards street crime not to earn a living or jobless, but other motivating push factors that relate to the personalities of the offenders such as drug addiction. Moreover, income inequality is only significant in terms of total street crime and unarmed robbery gang estimation models as well as GDP per capita and population in snatch and theft estimation models. Interestingly, we extend the by changing the definition of crime into percentage and the results show that the cost of living is significant with the correct sign and has a positive relationship with all types of street crime rates except for snatch and theft estimation models. The GDP per capita is also a main influencer on all types of street crime rates and has a negative relationship. Finally, the unemployment rate is only significant in the unarmed robbery estimation models and has a positive relationships as well as income inequality variable in total street crime and unarmed robbery gang estimation models. This street crime has been shown to be sensitive to the change in unemployment rate and income inequality and also have positive linkages

Investigating the Determinants of Energy Expenditure in Malaysia Major Cities by Middle-income Households

This paper attempts to investigate the factors that affecting energy expenditure in Malaysia capital city by middle-income households. The aim of this study was to find out the determinants of household spending on electricity and petrol in three major cities (George Town, Kuala Lumpur and Johor Bahru). A survey was conducted in these three major cities and a total of 473 observations are used for estimations by using the censored Tobit model. The results showed that household income is statistically significant and do affect electricity spending. Meanwhile, petrol spending is not significant as households consider petrol as an undesirable purchase in Malaysian domestic market. Also, there is a strong evidence of relationship between the number of electrical appliances and the number of rooms with electricity expenditure, as well as the number of private cars with petrol spending due to the complementarity. The results also proved that race does not play a crucial role in affecting electricity and petrol expenditure in Malaysia. But from a different perspective, electricity spending pattern by households in Johor Bahru, George Town and Kuala Lumpur is completely different, whereas Johor Bahru has different spending patterns in petrol