Impact of Government Expenditure, Exchange Rate and Unemployment Rate on Economic Growth of Malaysia
The objective of the study is to investigate the association between government expenditure, exchange rate and unemployment rate on economic growth of Malaysia from 1988 to 2017. All variables in the model are cointegrated with two cointegrating vectors and implies that long-run relat...
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| Main Authors: | , , , |
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| Format: | Article |
| Language: | English |
| Published: |
Universal Publishers - Boca Raton, Florida, USA
2021
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| Subjects: | |
| Online Access: | http://ir.unimas.my/id/eprint/35430/1/IMPACT%20OF%20GOVERNMENT%20EXPENDITURE.pdf http://ir.unimas.my/id/eprint/35430/ http://www.gbmrjournal.com/pdf/v13n2/V13N2-2.pdf |
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| Summary: | The objective of the study is to investigate the association between government expenditure, exchange rate and unemployment rate on economic growth of Malaysia from 1988 to 2017. All variables in the model are cointegrated with two cointegrating vectors and implies that long-run relationship exist. Granger Causality based on Vector Error Correction Model (VECM) revealed an unidirectional short run causality from government expenditure to economic growth, economic growth to unemployment, unemployment to exchange rate and unemployment to government expenditure. Policies such as fiscal policy and exchange rate policy need to be implemented by policy makers in Malaysia to ensure empowering economic growth. |
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