IDEAS home Printed from https://ideas.repec.org/a/sae/mareco/v9y2015i1p61-91.html
   My bibliography  Save this article

Income and Employment Multiplier Effects of the Malaysian Higher Education Sector

Author

Listed:
  • Siew Hwa Yen

    (Siew Hwa Yen (corresponding author) is Fellow Researcher at the Malaysian National Higher Education Research Institution and Senior Lecturer at School of Distance Education (Economics Section), Universiti Sains Malaysia, 11800, Minden, Penang, Malaysia, email: shyen@usm.my)

  • Wooi Leng Ong

    (Wooi Leng Ong is a graduate student at the National University of Singapore, email: wooilengong@yahoo.com)

  • Koon Peng Ooi

    (Koon Peng Ooi is an undergraduate student at University of British Columbia, email: ooikoonpeng@hotmail.com)

Abstract

The aim of this article is to examine the income and employment multiplier effects of the higher education sector in Malaysia based on conventional input–output methodology. We examined simple, total, Type I and Type II income and employment multiplier effects of private and public higher education institutions (HEIs) in Malaysia. We found that private HEIs have larger direct and indirect income impacts than public HEIs. With the presence of household spending, both public and private HEIs have greater induced income impacts than direct and indirect income generation effects. We also found that Type I multipliers for private and public HEIs lead to additional income of 1.34 and 1.32 for every initial Ringgit of labour income, respectively, while Type II income multipliers for private and public HEIs account for additional income of 3.09 and 3.05, respectively. Higher education creates 1.21 workers per RM 10,000 investment. The overall results show that private higher education has a relatively greater income effect on the economy.compared to public higher education. The higher education sector is also found to be ineffective in creating new employment in the economy. JEL Classification: I23, I25

Suggested Citation

  • Siew Hwa Yen & Wooi Leng Ong & Koon Peng Ooi, 2015. "Income and Employment Multiplier Effects of the Malaysian Higher Education Sector," Margin: The Journal of Applied Economic Research, National Council of Applied Economic Research, vol. 9(1), pages 61-91, February.
    • Handle: RePEc:sae:mareco:v:9:y:2015:i:1:p:61-91
    DOI: 10.1177/0973801014557391
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1177/0973801014557391
    Download Restriction: no
    File URL: https://libkey.io/10.1177/0973801014557391?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Rubén Garrido-Yserte & María Gallo-Rivera, 2010. "The impact of the university upon local economy: three methods to estimate demand-side effects," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 44(1), pages 39-67, February.
    2. Petrakis, P. E. & Stamatakis, D., 2002. "Growth and educational levels: a comparative analysis," Economics of Education Review, Elsevier, vol. 21(5), pages 513-521, October.
    3. de Meulemeester, Jean-Luc & Rochat, Denis, 1995. "A causality analysis of the link between higher education and economic development," Economics of Education Review, Elsevier, vol. 14(4), pages 351-361, December.
    4. Bekhet, Hussain Ali, 2013. "Assessing structural changes in the Malaysian economy: I–O approach," Economic Modelling, Elsevier, vol. 30(C), pages 126-135.
    5. Lin, Tin-Chun, 2004. "The role of higher education in economic development: an empirical study of Taiwan case," Journal of Asian Economics, Elsevier, vol. 15(2), pages 355-371, April.
    6. Siegfried, John J. & Sanderson, Allen R. & McHenry, Peter, 2007. "The economic impact of colleges and universities," Economics of Education Review, Elsevier, vol. 26(5), pages 546-558, October.
    7. Hussain Ali Bekhet & Azlina Abdullah, 2013. "An examination of the relationship between energy consumption and performance of transportation sector in Malaysia: output multipliers approach," International Journal of Economics and Business Research, Inderscience Enterprises Ltd, vol. 5(2), pages 147-164.
    Full references (including those not matched with items on IDEAS)

    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. Daniel Ştefan Armeanu & Georgeta Vintilă & Ştefan Cristian Gherghina, 2017. "Empirical Study towards the Drivers of Sustainable Economic Growth in EU-28 Countries," Sustainability, MDPI, vol. 10(1), pages 1-22, December.
    2. Panagiotis Pegkas & Constantinos Tsamadias, 2014. "Does Higher Education Affect Economic Growth? The Case of Greece," International Economic Journal, Taylor & Francis Journals, vol. 28(3), pages 425-444, September.
    3. Vinhais, Henrique & Guilhoto, Joaquim, 2012. "Economic Impact of the Expansion of Federal Universities in Brazil," TD NEREUS 16-2012, Núcleo de Economia Regional e Urbana da Universidade de São Paulo (NEREUS).
    4. Vijay P. Ojha & Joydeep Ghosh, 2014. "Optimizing Public Expenditure Allocations between Secondary and Higher Education," Centre for International Trade and Development, Jawaharlal Nehru University, New Delhi Discussion Papers 14-02, Centre for International Trade and Development, Jawaharlal Nehru University, New Delhi, India.
    5. Chaohai Shen & Tong Sheng & Xingheng Shi & Bingquan Fang & Xiaoqian Lu & Xiaolan Zhou, 2022. "The Relationship between Housing Price, Teacher Salary Improvement, and Sustainable Regional Economic Development," Land, MDPI, vol. 11(12), pages 1-21, December.
    6. José M. Pastor & Carlos Peraita & Francisco Pérez, 2016. "Estimating the long-term economic impacts of Spanish universities on the national economy," Papers in Regional Science, Wiley Blackwell, vol. 95(4), pages 673-692, November.
    7. Balazs Kotosz, 2016. "University impact evaluation: Counterfactual methods," ERSA conference papers ersa16p735, European Regional Science Association.
    8. Maria Adamakou & Spyros Niavis & Dimitris Kallioras & George Petrakos, 2021. "Understanding the Regional Engagement of Universities from a Stakeholders’ Perspective: The Case of the University of Thessaly, Greece," Sustainability, MDPI, vol. 13(19), pages 1-14, September.
    9. Turan, Güngör, 2016. "Türkiye'de Yüksek Öğretim ve Ekonomik Büyüme [Higher Education and Economic Growth in Turkey]," MPRA Paper 77778, University Library of Munich, Germany.
    10. Saarivirta, Toni & Consoli, Davide, 2007. "Where Did They Go? A Study on Newly Established Universities and Graduate Mobility in Finland," MPRA Paper 11377, University Library of Munich, Germany.
    11. Khattak, Naeem Ur Rehman & khan, jangraiz, 2012. "The Contribution of Education to Economic Growth: Evidence from Pakistan," MPRA Paper 51180, University Library of Munich, Germany.
    12. Gazi Mainul Hassan & Arusha Cooray, 2013. "Effects of Male and Female Education on Economic Growth: Some Evidence from Asia Using the Extreme Bounds Analysis," Working Papers in Economics 13/10, University of Waikato.
    13. Aziz, Babar & Khan, Tasneem & Aziz, Shumaila, 2008. "Impact of Higher Education on Economic Growth of Pakistan," MPRA Paper 22912, University Library of Munich, Germany, revised 2008.
    14. Hassan, Gazi & Cooray, Arusha, 2015. "Effects of male and female education on economic growth: Some evidence from Asia," Journal of Asian Economics, Elsevier, vol. 36(C), pages 97-109.
    15. Bahar Bayraktar-Sağlam, 2016. "The Stages of Human Capital and Economic Growth: Does the Direction of Causality Matter for the Rich and the Poor?," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 127(1), pages 243-302, May.
    16. Kotosz, Balázs & Lukovics, Miklós & Zuti, Bence & Molnár, Gabriella, 2016. "Egyetemi funkciók és helyi gazdasági hatások: módszertani problémák és lehetséges megoldások [University Functions and Local Economic Effects: Methodological Problems and Possible Solutions]," MPRA Paper 78797, University Library of Munich, Germany, revised 2016.
    17. Vijay P. Ojha & Joydeep Ghosh & Basanta K. Pradhan, 2022. "The role of public expenditure on secondary and higher education for achieving inclusive growth in India," Metroeconomica, Wiley Blackwell, vol. 73(1), pages 49-77, February.
    18. Balazs Kotosz & Marie-France Gaunard-Anderson & Miklos Lukovics, 2015. "International Inequalities in The Local Economic Impact of Universities: The Case of Hungary and France," ERSA conference papers ersa15p777, European Regional Science Association.
    19. William M. Bowen & Haifeng Qian, 2017. "State spending for higher education: Does it improve economic performance?," Regional Science Policy & Practice, Wiley Blackwell, vol. 9(1), pages 7-23, March.
    20. Hussain Ali Bekhet & Tahira Yasmin, 2014. "Assessment of the global financial crisis effects on energy consumption and economic growth in Malaysia: An input–output analysis," International Economics, CEPII research center, issue 140, pages 49-70.

    More about this item

    Keywords

    Input–Output Analysis; Income Multiplier; Employment Multiplier; Higher Education;
    All these keywords.

    JEL classification:

    • I23 - Health, Education, and Welfare - - Education - - - Higher Education; Research Institutions
    • I25 - Health, Education, and Welfare - - Education - - - Education and Economic Development

    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:sae:mareco:v:9:y:2015:i:1:p:61-91. 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: SAGE Publications (email available below). General contact details of provider: http://www.ncaer.org/ .

    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.