• ECONOMIC DEVELOPMENT AND GOVERNMENT EXPENDITURE: A CASE STUDY OF MALAYSIA

• UNEMPLOYMENT HYSTERESIS IN THREE COUNTRIES OF BIMP-EAGA:   PANEL UNIT ROOT TESTS APPROACH

• NEIGHBOURHOOD COHESIVENESS PROGRAMME: A STUDY IN THREE DIFFERENT LOCALITIES  IN  THE CITY HALL OF KUCHING NORTH,  SARAWAK, MALAYSIA

• PRODUCTION AND CONSUMPTION OF DAIRY PRODUCTS IN THAILAND: TRENDS AND POLICIES1

• DETERMINATION OF FOREIGN DIRECT INVESTMENT IN ASEAN COUNTRIES: SOME EMPIRICAL EVIDENCE

ECONOMIC DEVELOPMENT AND GOVERNMENT EXPENDITURE:
A CASE STUDY OF MALAYSIA

Fumitaka Furuoka

This paper empirically examines the relationship between economic development and government expenditure in Malaysia. Although the public sector has played a decisive role in the economic planning and development, there is still a lack of empirical research on this important topic. An intricate relationship between economic development and government expenditure was first systematically analysed by a German economist, Adolf Wagner. Hence, the long-run relationship between these two variables is known as “Wagner’s law”. Findings of the present research indicate the importance of the public sector role in Malaysia’s economic development process. Econometric analysis carried out in this study detected the existence of a long-run equilibrium, as well as a short-run relationship, between Malaysia’s economic development and government expenditure. Also, the results of Granger causality test indicate that there is a bilateral causality between the size of government expenditure and the size of domestic product in Malaysia.

 
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UNEMPLOYMENT HYSTERESIS IN THREE COUNTRIES OF BIMP-EAGA:   PANEL UNIT ROOT TESTS APPROACH
 
Fumitaka Furuoka

 Abstract       

This paper uses panel unit root tests to analyse unemployment hysteresis in three countries within the BIMP-EAGA. According to the hysteresis hypothesis, business cycle will have permanent effects on the level of unemployment. This paper employs the following three different unit root tests: (1) Levin-Lin (LL) test, (2) Im-Pesaran-Shin (IPS) test and (3) Maddala-Wu (MW) test in order to analyse the hysteresis in unemployment in the area. The empirical findings indicate that there exists unit root in unemployment rate time series in these countries. This means that equilibrium rate of unemployment in these countries tends to be path-dependent and fluctuations will have permanent effects on the level of unemployment. This fact suggests that high unemployment could be prolonged if there is a lack of appropriate government intervention policies to address the problem of unemployment.

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NEIGHBOURHOOD COHESIVENESS PROGRAMME: A STUDY IN THREE DIFFERENT LOCALITIES  IN  THE CITY HALL OF KUCHING NORTH,  SARAWAK, MALAYSIA

 Ahi  Sarok, Nicholas Amin, Daniel Chew  & Leila Sim

 Abstract 

The Neighbourhood Cohesiveness Programme (NCP) was officially launched in November 2000 by the Right Honourable Chief Minister of Sarawak. Consequently, eight residential areas within the jurisdiction of the City Hall of Kuching North (DBKU) were chosen by the city hall to implement the programme. The purpose of this study is to gauge the respondents’ knowledge and their perceptions of the programme. A purposive sampling technique was employed and 1,284 respondents in the designated residential areas were interviewed on their knowledge and perceptions of the programme. Respondents were also asked whether they were acquainted with their neighbours living in the same neighbourhood, where the meetings with their neighbours took place and whether they participated in activities organized in their neighbourhood. Respondents were also asked about their responsibilities as a responsible and good neighbour. Lastly, the respondents were also asked how they could contribute towards the successful realization of this programme.

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PRODUCTION AND CONSUMPTION OF DAIRY PRODUCTS IN THAILAND: TRENDS AND POLICIES1

Pemasiri Gunawardana and Sukij Khorchunklang

Abstract         

This paper provides an overview of the historical aspects of the dairy industry in Thailand, and presents an analysis of the trends in and policies towards the production and consumption of dairy products in Thailand. Although the Thai government promotes domestic milk production, the domestic supply is still inadequate in comparison with the demand from the domestic dairy processing industry and consumers. Hence, Thailand imports large volumes of dairy products, the bulk of which is milk dry.

 
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DETERMINATION OF FOREIGN DIRECT INVESTMENT IN ASEAN COUNTRIES: SOME EMPIRICAL EVIDENCE*

Wong Hock Tsen

 Abstract 

This study investigates the determination of foreign direct investment (FDI) in ASEAN countries, namely Indonesia, Malaysia, the Philippines, Singapore and Thailand. For ASEAN countries as a group, the results show that the market size is found to have a significant positive impact on FDI. Factors such as the formation of ASEAN free trade area (AFTA) and Asian financial crisis, 1997-1998 are not found to have a significant impact on FDI. For each of ASEAN countries, the results show about the same conclusion as those obtained for ASEAN countries as a group. Market-seeking FDI is an important type of FDI in ASEAN countries. Moreover, there is no simple generalisation of the determination of FDI, which implies the determination of FDI is to be justified on a case-by-case basis.

 
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* A version of the paper was prepared for presentation at International Borneo Business Conference: The Impact of Contemporary Environment on Economics and Business, 9-11 December 2004, Sutera Harbour, Sabah, Malaysia.

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