Malaysian bilateral exports and bilateral real exchange rates

This paper analyzes the performance of Malaysian bilateral exports to its major importing countries: the United States, Japan, and Singapore and then investigates whether the export performance could be improved through depreciation or devaluation of domestic currency using co-integration technique and VECM. The co-integration test suggests that real exports, real exchange rates, real imports, and foreign income are co-integrated. The estimated long-run export equations indicate that the real exchange rates, real foreign income, and real imports are important determinants of exports. The major policy implication from this study is that a devaluation or depreciation of ringgit could improve the competitiveness of Malaysian exports

Study on the Characteristics of Effective Information Literacy Programs for High School Students in Japan

Thesis (Master of Science in Library and Information Studies)--University of Tsukuba, no. 36036, 2016.8.3

The effects of real exchange rate on trade balance and domestic output: a case of Malaysia

The main objective of this study is to determine the effects of real exchange rate changes on the real Malaysian trade balance and the domestic output during the pegged exchange rate regime, 1977:1{1998:2, using quarterly data. The cointegration results suggest that a real ringgit exchange rate depreciation improves the Malaysian balance of trade in the long run.The impulse response analysis suggests that the effects of a depreciation of ringgit on the trade balance and domestic output are quite similar. A devaluation will initially improve the trade balance and domestic output, after which the trade balance starts to deteriorate and then the recession sets in, but subsequently both the trade balance and domestic output improve

Fiscal policy in an Islamic economy and the role of Zakat

This study incorporates Zakat into a simple macroeconomic model of an Islamic economy and analyzes the role of Zakat in the national income determination. The reduced form aggregate consumption function suggests that the determinants of consumption are: Zakat expenditure, taxes, income, and asset holdings of individuals. Zakat could be used as a counter-cyclical policy through the discretionary and non-discretionary fiscal policy. The discretionary fiscal policy is carried out by varying the disbursement of Zakat to the recipients. During the expansion phase of the business cycle the government reduces Zakat expenditure to close the inflationary gap. This action helps increase the Zakat surplus in the Baitul-Mal. Likewise the Zakat expenditure could be increased, by using the Zakat surplus accumulated during the boom periods, when the economy is in the down-swing to spur aggregate spending and economic activities. Therefore government spending and taxation could complement Zakat as stabilization policy

Wage rate and employment in the manufacturing sector of Malaysia

This paper examines the importance of Malaysian manufacturing industries to the domestic economy and then estimates the demand for labor as a function of wage rate, output, and capital. The study uses the survey data of firms categorized according to the 3-digit Malaysian Standard Industrial Classification. The manufacturing sector has been contributing significantly to the Malaysia’s economy in terms of its contribution to GDP, employment, and exports. The OLS results suggest that wage rate, output or production, and capital are all important determinants of labor employment in the manufacturing sector in Malaysia. Although their elasticities with respect to employment of labor are all inelastic, the demand for labor is relative more responsive to the changes in the output and capital than the wage rate. Therefore implementing policies to encourage capital accumulation and overall economic growth are indeed helpful to boost employment in the manufacturing sector. Malaysia’s manufacturing output are mostly exported to foreign countries. This study indicates that the wage rate is an important determinant of labor demand in the manufacturing sector. Malaysia therefore has to manage it wage structure carefully such that the increase in wage rate must be in line with the increase in labor productivity. Otherwise Malaysian exports of manufactures will not be competitive in the world market and this will adversely affect the performance of Malaysian economy since Malaysia has been an export-oriented country in which exports have been the engine of growth

Zakat expenditure, school enrollment, and economic growth in Malaysia

The main objective of this study is to determine the impact of zakat spending and school enrollment on economic growth using panel data represented by the fourteen states of Malaysia. Zakat is collected and disbursed to the eight groups of eligible recipients by each state in Malaysia. Malaysia also has been one of the developing countries that has given a special attention on education to provide the man-power and skills needed by the various sectors of the economy. As a result, there has been a large increase in the enrollment of students in both primary and secondary schools as well as in tertiary education. The results of this study support the hypothesis that zakat spending and school enrollment are important determinants of economic growth in Malaysia. The zakat spending and student enrollment could significantly explain the variation in the growth of real output represented by the growth in real GDP. Therefore, it is suggested that all Muslim countries must improve the efficiency of zakat collection and spend it prudently. A more serious effort has to be made to formulate better strategies, planning, and effective policy actions to provide the needed infrastructure and to increase the stock of human capital in accordance to the need of the nations to generate growth and sustain the development of Muslim society. Keywords: zakat, school enrollment, growth, panel data, Malaysi

Riba, profit rate, Islamic rate, and market equilibrium

Muslim economists have suggested the profit rate to replace riba in an Islamic economic system. While this suggestion is a step in the right direction, it still has problem since not all profits are halal, as for example, profits from gaming and liquor businesses are definitely haram. This paper discusses the concept of riba and differentiates it from the profit rate and Islamic rate. As riba is prohibited in Islam, this paper explains the concepts of Islamic rate, which is lawful in Islam as it is directly derived from the profits of halal business activities. The Islamic rate is the clearing mechanism in the money market and good market. The paper has also derived the money market equilibrium and good market equilibrium conditions or the IS-LM framework which can be used to analyse the efficacy of monetary and fiscal policy in an Islamic state. In order to clear the notion that the conventional banking system has been dictating the decision makings in the Islamic banking system in Malaysia, the paper uses the Toda-Yamamoto technique of Granger causality test to see the causality between the Islamic investment deposit rates of Islamic banking and the fixed deposit rates of the conventional banking. The results are not conclusive as a number of Islamic investment deposit rates have caused the fixed deposit rates while some fixed deposit rates cause Islamic investment deposit rates, and yet some others show that there are no causality between the two types of rate. Keywords: riba, profit rate, Islamic rate, good market and money market equilibriu

Malaysian bilateral trade relations and economic growth

This paper examines the structure and trends of Malaysian bilateral exports and imports and then investigates whether these bilateral exports and imports have caused Malaysian economic growth. Although the structure of Malaysia’s trade has changed quite significantly over the last three decades, the direction of Malaysia’s trade remains generally the same. Broadly, ASEAN, the EU, East Asia, the US and Japan continue to be the Malaysia’s major trading partners. The Granger causality tests have shown that it is the bilateral imports that have caused economic growth in Malaysia rather than the bilateral exports

Malaysian bilateral trade relations and economic growth

This paper examines the structure and trends of Malaysian bilateral exports and imports and then investigates whether these bilateral exports and imports have caused Malaysian economic growth. Although the structure of Malaysia’s trade has changed quite significantly over the last threedecades, the direction of Malaysia’s trade remains generally the same. Broadly, ASEAN, the EU, East Asia, the US and Japan continue to be the Malaysia’s major trading partners. The Granger causality tests have shown that it is the bilateral imports that have caused economic growth in Malaysia rather than the bilateral exports

An analysis of Zakat expenditure and real output: theory and empirical evidence

This study advocates zakat as the major and potent fiscal policy instrument in an Islamic state. Zakat plays its role in the macroeconomic stabilization policy through the non -discretionary and discretionary fiscal policy. The built -in stabilizer mechanism occurs when zakat collection is automatically reduced during recession giving more money to the people to spend which tends to stimulate the economy; while during the boom period more zakat is collected, reducing the ability of the people to spend which tends to dampen economic activities. These reduce macroeconomic fluctuations. As a discretionary fiscal policy, the government varies the disbursement of zakat to the recipients whenever necessary during the phases of a business cycle. During the expansion phase, the government decreases zakat disbursement to reduce aggregate spending. Likewise zakat disbursement is increased when the economy is in the downswing to increase aggregate spending. Empirical evidence using Malaysian data supports the hypothesis that zakat spending is a potent fiscal instrument to improve the economic performance. The results of panel data regression analysis indicate that zakat expenditure could significantly explain the variation in the real output. This suggests that Muslim countries should make serious effort to improve the efficiency of zakat collection and spending to generate growth and the development of umma