Does Trade With Labour Sending Countries Reduce Demand for Migrant Workers: A Lesson from Malaysia
This paper has three objectives. The first objective is to examine the long-run relationships among exports, imports, income and demand for migrant workers. This is followed by a causality test between these variables as the second objective. Finally, the third objective is to examine the extent to which exports, imports and income affect the demand for migrant workers. The study utilizes time series data and a Vector Auto Regressive (VAR) framework while examining two models, namely, Malaysia and Malaysia-Indonesia (Malindo). The findings show that all variables in the models are cointegrated. Generally, there is no short-run causality between variables in the models. In the long-run, causality runs from exports, imports and income to demand for migrant workers for the Malaysia model. There is bi-directional causality in the long-run between exports and imports, respectively, and demand for migrant workers in the Malindo model. Exports and demand for migrant workers in the Malaysia model, and exports and imports, respectively, and demand for migrant workers from Indonesia in the Malindo model are substitutes. Moreover, the income per capita for Malaysia has a non-significant negative effect on the demand for total migrant workers and a significant positive effect on the demand for migrant workers from Indonesia. The study suggests that trade can be a necessary instrument, but not a sufficient instrument for reducing the demand for migrant workers.
Volume (Year): 3 (2013)
Issue (Month): 10 (October)
|Contact details of provider:|| Postal: Sadeeq Block, Near Fawara Chowk, Abbasia Town, Rahim Yar Khan - 64200, Punjab, Pakistan|
Web page: http://www.aessweb.com/
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Harry P. Bowen & Jennifer Pedussel wu, 2004.
"Does IT matter where immigrants work? Traded goods, non-traded goods, and sector specific employment,"
Vlerick Leuven Gent Management School Working Paper Series
2004-14, Vlerick Leuven Gent Management School.
- Bowen, Harry P. & Pédussel Wu, Jennifer, 2004. "Does it matter where immigrants work? Traded goods, non-traded goods, and sector specific employment," ZEI Working Papers B 16-2004, University of Bonn, ZEI - Center for European Integration Studies.
- Johansen, Soren & Juselius, Katarina, 1990. "Maximum Likelihood Estimation and Inference on Cointegration--With Applications to the Demand for Money," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 52(2), pages 169-210, May.
- Wagner, Don & Head, Keith & Ries, John, 2002. "Immigration and the Trade of Provinces," Scottish Journal of Political Economy, Scottish Economic Society, vol. 49(5), pages 507-25, December.
- Philip Bodman, 1998. "A Contribution on the Empirics of Trade, Migration and Economic Growth for Australia and Canada," International Economic Journal, Taylor & Francis Journals, vol. 12(3), pages 41-62.
- Markusen, James R., 1983. "Factor movements and commodity trade as complements," Journal of International Economics, Elsevier, vol. 14(3-4), pages 341-356, May.
- Kwiatkowski, Denis & Phillips, Peter C. B. & Schmidt, Peter & Shin, Yongcheol, 1992.
"Testing the null hypothesis of stationarity against the alternative of a unit root : How sure are we that economic time series have a unit root?,"
Journal of Econometrics,
Elsevier, vol. 54(1-3), pages 159-178.
- Kwiatkowski, D. & Phillips, P.C.B. & Schmidt, P., 1990. "Testing the Null Hypothesis of Stationarity Against the Alternative of Unit Root : How Sure are we that Economic Time Series have a Unit Root?," Papers 8905, Michigan State - Econometrics and Economic Theory.
- Denis Kwiatkowski & Peter C.B. Phillips & Peter Schmidt, 1991. "Testing the Null Hypothesis of Stationarity Against the Alternative of a Unit Root: How Sure Are We That Economic Time Series Have a Unit Root?," Cowles Foundation Discussion Papers 979, Cowles Foundation for Research in Economics, Yale University.
- Bowen, Harry P. & Pédussel Wu, Jennifer, 2012.
"Immigrant specificity and the relationship between trade and immigration: Theory and evidence,"
70, Berlin School of Economics and Law, Institute of Management Berlin (IMB).
- Harry P. Bowen & Jennifer Pédussel Wu, 2013. "Immigrant Specificity and the Relationship between Trade and Immigration: Theory and Evidence," Southern Economic Journal, Southern Economic Association, vol. 80(2), pages 366-384, October.
- Harry P. Bowen & Jennifer Pedussel Wu, 2011. "Immigrant Specificity and the Relationship between Trade and Immigration: Theory and Evidence," Discussion Paper Series 2011-01, McColl School of Business, Queens University of Charlotte, revised 13 Jul 2012.
- Athukorala, Prema-chandra & Devadason, Evelyn S., 2012.
"The Impact of Foreign Labor on Host Country Wages: The Experience of a Southern Host, Malaysia,"
Elsevier, vol. 40(8), pages 1497-1510.
- Prema-chandra Athukorala & Evelyn S Devadason, 2011. "The Impact of Foreign Labour on Host Country Wages: The Experience of a Southern Host, Malaysia," Departmental Working Papers 2011-03, The Australian National University, Arndt-Corden Department of Economics.
- Noel Gaston & Douglas R. Nelson, 2013. "Bridging Trade Theory And Labour Econometrics: The Effects Of International Migration," Journal of Economic Surveys, Wiley Blackwell, vol. 27(1), pages 98-139, 02.
When requesting a correction, please mention this item's handle: RePEc:asi:aeafrj:2013:p:1325-1336. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Qazi Muhammad Imran)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.