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Malaysia's Time Varying Capital Mobility

Author

Listed:
  • Turkhan Ali Abdul Manap

    (Dept. of Economics, KENMS, International Islamic University Malaysia)

  • Gairuzazmi M Ghani

    (Dept. of Economics, KENMS, International islamic University Malaysia)

Abstract

This paper examines the dynamics of the degree of capital mobility for Malaysia for the period 1991Q1-2009Q4. Generally Malaysia has been an open economy for trade, however periodic episodes of capital control such as those in 1994 and 1998 means that the level of capital mobility in Malaysia might be time varying. In order to measure the degree of capital mobility, this paper uses the Shibata and Shintani (1998) model that examines the relationship between consumption and output. The results show that for the period investigated, the degree of capital mobility relatively low, especially after the 1997/98 East Asia financial crisis. Meanwhile the periods of capital control show a reduction in the degree of capital mobility.

Suggested Citation

  • Turkhan Ali Abdul Manap & Gairuzazmi M Ghani, 2012. "Malaysia's Time Varying Capital Mobility," Economics Bulletin, AccessEcon, vol. 32(2), pages 1361-1368.
    • Handle: RePEc:ebl:ecbull:eb-12-00228
    as

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    References listed on IDEAS

    as
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    More about this item

    Keywords

    capital mobility; intertemporal current account model; Kalman Filter;
    All these keywords.

    JEL classification:

    • F4 - International Economics - - Macroeconomic Aspects of International Trade and Finance
    • F3 - International Economics - - International Finance

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