Macroeconomic Impacts of Immigration in Malaysia: Trade, Remittances and Unemployment

The macroeconomic consequence of immigration is a disputable area among many interested parties as evidenced by the empirical studies. Most studies, however, employ Anglo-Saxon countries as their subjects, while there is an increasing demand for studies on the economic consequences of immigration in developing countries. As a developing country, Malaysia has attracted immigration over the years, and the population of migrant labour in Malaysia has reached more than two million in 2008, which makes up 7% of the total population and 20% of total labour force. Thus, such large presence has provided a rationale for an economic analysis on the impact of immigrations on the Malaysian economy. This research, hence, aims to analyze the economic impact of immigration in Malaysia in the context of trade, remittance and unemployment in an interrelated manner. These topics are examined in detail in three separate empirical essays. Specifically, the first essay examines the link between bilateral trade and immigration, while the second essay explores the relationship between remittances of the Indonesian workers in Malaysia and the macroeconomic variables both in Malaysia and Indonesia. The last empirical essay analyses the relationship between unemployment and immigration in Malaysia. These empirical essays use quantitative research methodology in the form of panel and time series data analysis. However, each essay is based on a different theoretical framework, econometric methods, timelines and samples due to availability data and the nature of the study. The findings of the first essay indicates that immigration increases both exports and imports through both preference and immigration-link mechanisms, implying that immigrants play a vital role in fostering trade between Malaysia and countries of origin. In the second essay, it is found that Indonesian labour in Malaysia take macroeconomic conditions in both countries into account in their remittance decisions and the findings demonstrate that the main motives to remit is altruism and portfolio investment, indicating the importance of the level of economic activities in both countries. The third essay reveals that there is a lack of evidence supporting the hypothesis of adverse employment effect of immigration in Malaysia, implying that the job-creation effect of immigration has taken place, which has resulted in further economic and employment growth in both public and private sectors. In conclusion, immigration is vital for both host and home countries’ economic developments as the findings of this research have demonstrated, thus refuting the claims that their presence brings more harms than benefits

The importance of learning context in approaches to learning / Nur Fakhzan Marwan

The way students approach their learning is linked to the quality of their learning outcomes. However, approaches to learning, deep and surface approaches, should not be seen as uniquely a characteristic of the student, but as a response to a situation. Many researchers believe that although the concepts of learning approaches are not applicable to the individual students, it can describe students in particular learning condition. This means that the contextual factors are believed to have greater impacts on students’ approaches to learning. Thus, this paper discusses a framework that explores the variables or contextual factors that affect, hence, influence the adoption of approach to learning, such as students’ interest and experiences, feedback, assessment, teaching, and course structures in academic departments. The framework has some pedagogical implications that could promote quality learning

Purchasing power parity theory in three East Asian economies: New evidence

To an otherwise extensive literature with yet mixed findings on the long run Purchasing Power Parity (PPP) theory, this paper extends the evidence against the PPP hypothesis in three East Asian economies namely Indonesia, Malaysia, and Thailand based on quarterly data spanning forty years (1968:Q1-2008:Q1). The testing of PPP hypothesis in this study employs two methods namely Engle-Granger procedure and Johansen multivariate cointegration method

Economic growth and institutions in developing countries: Panel evidence

Numerous empirical studies have documented the evidence of institutional significance towards economic growth. This study extends such evidence as it examines the link between institutions and growth in developing countries including East Asian region. By using neoclassical growth framework augmented with institutional controls and latest estimation technique in panel data analysis, this study finds evidence of positive institutions growth-effects and uncovers the channel of their effects toward growth. This study also fills the gap in the East Asian growth literature, in which, to the best of our knowledge, only two studies namely Rodrik (1997) and Campos and Nugent (1999) that document the institutional importance toward economic growth for the region and apparently these studies are for the period before the 1997 Asian Financial Crisis

Purchasing power parity theory in three East Asian economies: New evidence

To an otherwise extensive literature with yet mixed findings on the long run Purchasing Power Parity (PPP) theory, this paper extends the evidence against the PPP hypothesis in three East Asian economies namely Indonesia, Malaysia, and Thailand based on quarterly data spanning forty years (1968:Q1-2008:Q1). The testing of PPP hypothesis in this study employs two methods namely Engle-Granger procedure and Johansen multivariate cointegration method

Crude palm oil price forecasting in Malaysia : an econometric approach

This paper aims to forecast the performance of crude palm oil price (CPO) in Malaysia by comparing several econometric forecasting techniques, namely Autoregressive Distributed Lag (ARDL), Autoregressive Integrated Moving Average (ARIMA) and Autoregressive Integrated Moving Average with exogenous inputs (ARIMAX). Using monthly time series data spanning from 2008 to 2017, the main results revealed that ARIMAX model is the most accurate and the most efficient model as compared to ARDL and ARIMA in forecasting the crude palm oil price. The results also show that the spot price of palm oil is highly influenced by stock of palm oil, crude petroleum oil price and soybean oil price. The empirical findings provide some insights for decision making and policy implementations, including the formulation of strategies to help the industry in dealing with the price changes and thus enable the Malaysian palm oil industry to continue dominating the international market

The effect of regime switching policy rules on economic growth

This paper empirically examines the relative effect of active and passive regime policy rules on economic growth. The time series data for a set of South-East Asian countries namely, Malaysia, Thailand and Singapore are used for the period 1971-2009. The Markov-switching (MSC) regression method is employed to characterize the regime switching for both monetary and fiscal policy reaction functions for each country. Then, the relative impact of these regime policies on long run output grow this estimated by using Auto Regressive Distributed Lag (ARDL) method. In order to control for different regime of policy rules, the dummy variables are included to capture the regime switching changes. The MSC regression shows that Thailand’s monetary policy is mostly active while fiscal policy is mostly passive throughout the sample covered. When both policies are considered, we note that Thailand changes its policy regimes very frequently. In contrast, Singapore’s regime switching is quite more stable. Singapore was in active monetary and passive fiscal for 20 years from 1971 to 1991. The country was in the passive monetary and passive fiscal regimes for 8 years before switching to passive monetary and active fiscal in year 2000 until 2009. Nevertheless, Malaysia’s monetary policy regimes are characterized as passive at all times while fiscal regime is active throughout the sample study. Furthermore, the ARDL cointegration shows that both monetary and fiscal policies are important in sustaining long run economic growth for Thailand. Meanwhile, Singapore’s economy is only positively determined by monetary policy while fiscal policy is insignificant. As for regime switching, our results indicate that only the monetary policy regime affects the economic growth in Thailand. This implies that an active monetary authority will only lead to a lower output growth. However, none of the regime variables is significant for Singapore which indicates that neither active nor passive regime really matters for economic growth