IDEAS home Printed from https://ideas.repec.org/a/eaa/aeinde/v10y2010i1_14.html
   My bibliography  Save this article

The Role Of Fdi Intensity In Achieving Productivity Driven Growth In Malaysian Economy

Author

Listed:
  • Ahmed, E. M

Abstract

This study investigates the decomposition of labour productivity growth into contributions of capital deepening, increased usage of Foreign Direct Investment intensity (FDI intensity), and the simultaneous contribution of the quality of these factors. This is expressed as the Total Factor Productivity (TFP) per unit of labour growth in achieving productivity-driven growth in the Malaysian economy. The results of this modified extensive growth theory model show that the productivity growth of Malaysia’s economy is input-driven and being based on FDI when the results of TFP per unit of labour growth were compared. The study also finds that there is a negative contribution of the TFP per unit of labour growth during the sub-period of 1987-1996, although the contribution of the labour productivity was one of the highest during this sub-period.

Suggested Citation

  • Ahmed, E. M, 2010. "The Role Of Fdi Intensity In Achieving Productivity Driven Growth In Malaysian Economy," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 10(1).
    • Handle: RePEc:eaa:aeinde:v:10:y:2010:i:1_14
    as

    Download full text from publisher

    File URL: http://www.usc.es/economet/reviews/aeid10114.pdf
    Download Restriction: No.
    ---><---

    References listed on IDEAS

    as
    1. Dollar, David & Sokoloff, Kenneth, 1990. "Patterns of productivity growth in South Korean manufacturing industries, 1963-1979," Journal of Development Economics, Elsevier, vol. 33(2), pages 309-327, October.
    2. Borensztein, E. & De Gregorio, J. & Lee, J-W., 1998. "How does foreign direct investment affect economic growth?1," Journal of International Economics, Elsevier, vol. 45(1), pages 115-135, June.
    3. Nadiri, M.I., 1993. "Innovations and Technological Spillovers," Working Papers 93-31, C.V. Starr Center for Applied Economics, New York University.
    4. Bruce A. Blonigen & Miao Wang, 2004. "Inappropriate Pooling of Wealthy and Poor Countries in Empirical FDI Studies," NBER Working Papers 10378, National Bureau of Economic Research, Inc.
    5. Akinlo, A. Enisan, 2004. "Foreign direct investment and growth in Nigeria: An empirical investigation," Journal of Policy Modeling, Elsevier, vol. 26(5), pages 627-639, July.
    6. M. Ishaq Nadiri, 1993. "Innovations and Technological Spillovers," NBER Working Papers 4423, National Bureau of Economic Research, Inc.
    7. Niels Hermes & Robert Lensink, 2003. "Foreign direct investment, financial development and economic growth," Journal of Development Studies, Taylor & Francis Journals, vol. 40(1), pages 142-163.
    8. Bruno Van Pottelsberghe De La Potterie & Frank Lichtenberg, 2001. "Does Foreign Direct Investment Transfer Technology Across Borders?," The Review of Economics and Statistics, MIT Press, vol. 83(3), pages 490-497, August.
    9. International Monetary Fund, 1996. "Growth in East Asia; What We Can and What We Cannot infer," IMF Economic Issues 1996/003, International Monetary Fund.
    10. Rao, P S & Preston, R S, 1984. "Inter-factor Substitution, Economies of Scale and Technical Change: Evidence from Canadian Industries," Empirical Economics, Springer, vol. 9(2), pages 87-111.
    11. Alwyn Young, 1995. "The Tyranny of Numbers: Confronting the Statistical Realities of the East Asian Growth Experience," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 110(3), pages 641-680.
    12. Durham, J.B.J. Benson, 2004. "Absorptive capacity and the effects of foreign direct investment and equity foreign portfolio investment on economic growth," European Economic Review, Elsevier, vol. 48(2), pages 285-306, April.
    13. Xu, Bin, 2000. "Multinational enterprises, technology diffusion, and host country productivity growth," Journal of Development Economics, Elsevier, vol. 62(2), pages 477-493, August.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Rahim KIA LASHAKI & Elsadig Musa AHMED, 2017. "FDI Inflow Spillover Effect Implications On The Asia Pacific Productivity Growth Through The Export Channel," Revista Galega de Economía, University of Santiago de Compostela. Faculty of Economics and Business., vol. 26(3), pages 57-72.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Carmen F. Castejón & Julia Wörz, 2006. "Good or Bad? The Influence of FDI on Output Growth: An industry-level analysis," wiiw Working Papers 38, The Vienna Institute for International Economic Studies, wiiw.
    2. Dalila NICET-CHENAF & Eric ROUGIER, 2009. "FDI and growth: A new look at a still puzzling issue," Cahiers du GREThA (2007-2019) 2009-13, Groupe de Recherche en Economie Théorique et Appliquée (GREThA).
    3. Ahmed, Elsadig Musa, 2012. "Are the FDI inflow spillover effects on Malaysia's economic growth input driven?," Economic Modelling, Elsevier, vol. 29(4), pages 1498-1504.
    4. Naijela Janaina Costa Silveira & Diogo Ferraz & Eduardo Polloni‐Silva & Diego Scarpa de Mello & Fernanda Pereira Sartori Falguera & Herick Fernando Moralles, 2022. "Modeling the building blocks of country‐level absorptive capacity: Comparing developed and emergent economies," Bulletin of Economic Research, Wiley Blackwell, vol. 74(3), pages 783-824, July.
    5. Beugelsdijk, Sjoerd & Smeets, Roger & Zwinkels, Remco, 2008. "The impact of horizontal and vertical FDI on host's country economic growth," International Business Review, Elsevier, vol. 17(4), pages 452-472, August.
    6. Zaiter Lahimer, Mahjouba, 2011. "L’impact des entrées de capitaux privés sur la croissance économique dans les pays en développement," Economics Thesis from University Paris Dauphine, Paris Dauphine University, number 123456789/7670 edited by Sterdyniak, Henri.
    7. Elsadig Musa Ahmed & Rahim Kialashaki, 2023. "FDI inflows spillover effect implications on the Asian‐Pacific labour productivity," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 28(1), pages 575-588, January.
    8. B. Seetanah, 2009. "Is Foreign Direct Investment Growth Conducive? New Evidences From Sub-Saharan African Countries, 1980-2005," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 9(2).
    9. Hailin Liao & Xiaohui Liu & Mark Holmes & Tom Weyman‐Jones, 2009. "The Impact Of Foreign R&D On Total Factor Productivity In The East Asian Manufacturing Industry," Manchester School, University of Manchester, vol. 77(2), pages 244-270, March.
    10. Iamsiraroj, Sasi, 2016. "The foreign direct investment–economic growth nexus," International Review of Economics & Finance, Elsevier, vol. 42(C), pages 116-133.
    11. Delgado, Michael S. & McCloud, Nadine & Kumbhakar, Subal C., 2014. "A generalized empirical model of corruption, foreign direct investment, and growth," Journal of Macroeconomics, Elsevier, vol. 42(C), pages 298-316.
    12. Maria Cipollina & Giorgia Giovannetti & Filomena Pietrovito & Alberto F. Pozzolo, 2012. "FDI and Growth: What Cross-country Industry Data Say," The World Economy, Wiley Blackwell, vol. 35(11), pages 1599-1629, November.
    13. David Mayer‐Foulkes & Peter Nunnenkamp, 2009. "Do Multinational Enterprises Contribute to Convergence or Divergence? A Disaggregated Analysis of US FDI," Review of Development Economics, Wiley Blackwell, vol. 13(2), pages 304-318, May.
    14. Benhua Yang, 2007. "FDI and growth: a varying relationship across regions and over time," Applied Economics Letters, Taylor & Francis Journals, vol. 15(2), pages 105-108.
    15. Capolupo, Rosa, 2009. "The New Growth Theories and Their Empirics after Twenty Years," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 3, pages 1-72.
    16. Alguacil, M. & Cuadros, A. & Orts, V., 2011. "Inward FDI and growth: The role of macroeconomic and institutional environment," Journal of Policy Modeling, Elsevier, vol. 33(3), pages 481-496, May.
    17. Lee, Jong-Wha & Shin, Kwanho, 2012. "Welfare implications of international financial integration," Japan and the World Economy, Elsevier, vol. 24(4), pages 235-245.
    18. Jan Van Hove, 2008. "The Impact of R&D Spillovers on Export Value: Does the Transmission Channel matter?," Working Papers 2008.3, International Network for Economic Research - INFER.
    19. Jellal, Mohamed & Bouzahzah, Mohamed, 2012. "Education investissements directs étrangers et croissance économique réflexions pour le maroc [Education foreign direct investments and economic growth some thoughts for morocco]," MPRA Paper 38883, University Library of Munich, Germany.
    20. Agbloyor, Elikplimi Komla & Abor, Joshua Yindenaba & Adjasi, Charles Komla Delali & Yawson, Alfred, 2014. "Private capital flows and economic growth in Africa: The role of domestic financial markets," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 30(C), pages 137-152.

    More about this item

    Keywords

    FDI intensity; input-driven; TFP per unit of labour; Malaysia’s economy;
    All these keywords.

    JEL classification:

    • E23 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Production
    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eaa:aeinde:v:10:y:2010:i:1_14. See general information about how to correct material in RePEc.

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: M. Carmen Guisan (email available below). General contact details of provider: http://www.usc.es/economet/eaa.htm .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.