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Purpose ― This study aims to examine the impact of population aging and fertility rates on economic growth in Malaysia for the sample spanning from 1961 to 2020. Method ― The study uses an Autoregressive Distributed Lagged (ARDL) model to examine the relationship between economic growth, the aging population, fertility rate, capital stock, and employment rate. Findings ― The main results provide evidence of a long-run relationship between aging, fertility rate, employment, and capital stock on Malaysian economic growth. The results also show that the aging population harms economic growth in the long run, but a decline in the fertility rate has been favorable to long-term economic growth. Implication ― These findings have significant implications for the execution and formulation of national aging and demographic policies and government efforts to achieve long-term fiscal sustainability. Originality ― This study empirically investigated the link between population aging and economic development, reflecting recent demographic trends in Malaysia. This study uses current data and an Autoregressive Distributed Lagged (ARDL) technique to analyze long-term economic growth and its association with supply-side determinants

This study aims to investigate the determinants of capital expenditure (capex) for Malaysian palm oil companies listed at Bursa Malaysia. The study uses the dynamic panel data analysis (generalized method of moment) estimation for the sample of 40 palm oil-oriented firms that spanning from year 2000 until 2016. Findings/Originality: The empirical findings revealed that, in the short run and the long run, the capex spending is significantly affected by the cash flow, sale growth, and world crude palm oil price. However, Average Q significantly influences the capex decision in the long run only. Thus, the policy implication from this study suggests that palm oil-oriented firms should take into account the movement of world crude palm oil (CPO) price in designing their capital expenditure strategy. In addition, proper planning for managing firms’ cash flow and sale growth are also important for expanding their capex in future.

The main objective of this paper is to evaluate the relative impact of financial sector development, government size and trade openness of a country on its economic growth. This is done to investigate which factors play more prominent role in leading the growth of the economy. Four ASEAN countries known for their similar economic orientation, namely Ma-laysia, Thailand, Indonesia and Singapore have been selected for this purpose. To achieve the objective, a series of econometric tests is applied. These include unit root test and cointe-gration test. A vector error correction model (VECM) is then applied to capture both the short-run dynamic and the long-run equilibrium relationship between variables. Impulse response function is utilized to look at the impact of each variable on economic growth while variance decomposition is used to measure the magnitude of the impact. The results show that trade openness plays the leading role in promoting economic growth in Malaysia, Sin-gapore and Indonesia. For Malaysia financial sector development follows second and the government size comes third while for Singapore the order is reverse. For Indonesia, the government size overtakes the leading role at the later stage while the financial sector devel-opment is immaterial. For Thailand, no firm conclusion can be made, as the results are not promising. The results signify that the right policies have been taken by the selected coun-tries to promote higher economic growth. Keywords: Economic growth, financial sector development, government size, trade openness.

The determination of the term structure of interest rate is of great interest to both policy makers and researchers in finance and economics. Not surprisingly, a large body of literature (among others, Fisher (1907), Cox, Ingersoll and Ross (1985), and Longstaff (2000). The uncertainty of interest rates is another variable that has been widely investi-gated, since it measures uncertainty of a macroeconomic nature. It is important both for its effect on the macroeconomic variables (interest rates, investments, etc.) and its effect on in-dividual or firm investment decisions (see, for example, Siegfred (2000)). Therefore, this study will focus on the interest rate spread resulting from default risk and attempts to explain how and why the risk spread leads business cycles. This study also contribute to the existing literature by looking at the interest rate uncertainty that plays a critical role in explaining the interest rate spread and economic activity. Furthermore, the finding shows that interest rate uncertainty embodies useful information in term of predicting the growth rate of indus-trial production. Key words: interest rate uncertainly, interest rate spread, economic activity

The main objectives of this paper is to examine the long run relationship between total expenditure, revenue (tax and nontax) and economic growth in ASEAN-5 countries namely by Malaysia, Indonesia, Thailand, Singapore and Philippines. According to the prior studies, there are several hypotheses to explain the relationship between revenue and spend-ing such as (1) spend-revenue hypotheses, (2) revenue-spend hypotheses and (3)bi-directional causality hypotheses. To test the validity of these hypotheses, this study will util-ize a cointegration and variance decomposition analysis. Based on empirical evidence, we can concluded that the existence of long run relationship between government spending, revenue (tax and non tax) and economic growth for all ASEAN-5 countries. The result of variance decomposition also shows that the strong influence on expenditure to revenue in countries namely Malaysia, Indonesia and Philippines, which support the ‘spend-revenue hypotheses. Meanwhile, for Thailand and Singapore the budget decision driven by revenue side which support the ‘revenue-spend hypotheses’. In addition, public expenditure plays no role to stimulate economic growth in Malaysia, Thailand, Singapore and Philippines, except for Indonesia. Key words: Fiscal economics; Wagner law; cointegration test; variance decomposition