The role of macroeconomic fundamentals in Malaysian post recession growth.
This study aims to find out the role of macroeconomic fundamentals in Malaysian post recession growth. The selected macroeconomic variables are exports, imports, price level, money supply, interest rate, exchange rate and government expenditure. The technique of cointegration was employed to assess...
| Main Author: | |
|---|---|
| Other Authors: | |
| Format: | Book Section |
| Published: |
Springer
2013
|
| Online Access: | http://psasir.upm.edu.my/id/eprint/26121/ |
| _version_ | 1848845494606888960 |
|---|---|
| author | Lee, Chin |
| author2 | N. M. P., Verma |
| author_facet | N. M. P., Verma Lee, Chin |
| author_sort | Lee, Chin |
| building | UPM Institutional Repository |
| collection | Online Access |
| description | This study aims to find out the role of macroeconomic fundamentals in Malaysian post recession growth. The selected macroeconomic variables are exports, imports, price level, money supply, interest rate, exchange rate and government expenditure. The technique of cointegration was employed to assess the long run equilibrium relationships among the variables. Then, this study performs the Granger causality tests based on VECM to establish the short run causality among the variables. The long-run cointegrating relationship shown that an increase in exports, government expenditure or depreciation of exchange rate will promote long-term economic growth while increase in inflation, interest rate and imports will tamper the Malaysian economic growth. The results of short-run Granger-causality indicated that price level and government spending Granger-caused economic growth in the short-run. In conclusion, based on the results of long-run and short run analysis, the fiscal policy is probably the most appropriate tool in promoting economic growth in Malaysia during the post recession period. |
| first_indexed | 2025-11-15T08:47:43Z |
| format | Book Section |
| id | upm-26121 |
| institution | Universiti Putra Malaysia |
| institution_category | Local University |
| last_indexed | 2025-11-15T08:47:43Z |
| publishDate | 2013 |
| publisher | Springer |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | upm-261212014-03-12T04:32:04Z http://psasir.upm.edu.my/id/eprint/26121/ The role of macroeconomic fundamentals in Malaysian post recession growth. Lee, Chin This study aims to find out the role of macroeconomic fundamentals in Malaysian post recession growth. The selected macroeconomic variables are exports, imports, price level, money supply, interest rate, exchange rate and government expenditure. The technique of cointegration was employed to assess the long run equilibrium relationships among the variables. Then, this study performs the Granger causality tests based on VECM to establish the short run causality among the variables. The long-run cointegrating relationship shown that an increase in exports, government expenditure or depreciation of exchange rate will promote long-term economic growth while increase in inflation, interest rate and imports will tamper the Malaysian economic growth. The results of short-run Granger-causality indicated that price level and government spending Granger-caused economic growth in the short-run. In conclusion, based on the results of long-run and short run analysis, the fiscal policy is probably the most appropriate tool in promoting economic growth in Malaysia during the post recession period. Springer N. M. P., Verma 2013 Book Section PeerReviewed Lee, Chin (2013) The role of macroeconomic fundamentals in Malaysian post recession growth. In: Recession and Its Aftermath: Adjustments in the United States, Australia, and the Emerging Asia. Springer, India, pp. 113-127. ISBN 9788132205319; EISBN: 9788132205326 10.1007/978-81-322-0532-6 |
| spellingShingle | Lee, Chin The role of macroeconomic fundamentals in Malaysian post recession growth. |
| title | The role of macroeconomic fundamentals in Malaysian post recession growth. |
| title_full | The role of macroeconomic fundamentals in Malaysian post recession growth. |
| title_fullStr | The role of macroeconomic fundamentals in Malaysian post recession growth. |
| title_full_unstemmed | The role of macroeconomic fundamentals in Malaysian post recession growth. |
| title_short | The role of macroeconomic fundamentals in Malaysian post recession growth. |
| title_sort | role of macroeconomic fundamentals in malaysian post recession growth. |
| url | http://psasir.upm.edu.my/id/eprint/26121/ http://psasir.upm.edu.my/id/eprint/26121/ |