Gravity theory - the determinants of IMS-GT on economy growth

• Main Author: Lim, Lian Nee
• Format: Final Year Project Report
• Language: English
• Published: Universiti Malaysia Sarawak, (UNIMAS) 2015
• Subjects: HB Economic Theory
• Online Access: http://ir.unimas.my/id/eprint/12314/1/Lim%20Wei%20Cheit%20ft.pdf; http://ir.unimas.my/id/eprint/12314/

This study investigates the relationship of macroeconomics performance on the development of IMS-GT in order to achieving integration of globalization. The indicators of GDP per Capita, Foreign Direct Invest (FDI) and Transportation Costs are adopted to examine the relationship between IMS-GT on its investment performance toward economy growth. In this study, purposely explained that determinant variables used to investigate the trade while, the GDP indicated the performance of country growth. The existence of cointegrating vector showed that there’s a long run relationship among the variables in this study. In the long run, there are some negative and positive results showed in IMS-GT. Indonesia showed a negative relationship between GDP per Capita and transportation costs toward economy growth. Malaysia do not achieved any long run and short run relationship in this study. Singapore showed a negative relationship between GDP per capita, FDI and Transportation costs toward GDP. In the short run, Singapore achieved bidirectional relationship between GDP per Capita and Foreign Direct Invest (FDI). While Indonesia only achieved unidirectional causality run from transportation costs to GDP.