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Consumption correlation and international capital market integration: evidence from Malaysia

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  • Goh Soo Khoon

Abstract

By evaluating the Malaysian consumption patterns, this article measures capital mobility in Malaysia with three main trading countries, namely the United States, Japan and Singapore. The results indicate that Malaysia's national consumption was fully integrated with the United States over the period 1960-2000. Since the consumption models are based on a high degree of capital mobility, there is some evidence that this condition is met in the Malaysian data. This indicates that Malaysia exhibited a substantial amount of financial openness despite periodic exchange controls.

Suggested Citation

  • Goh Soo Khoon, 2008. "Consumption correlation and international capital market integration: evidence from Malaysia," Applied Economics Letters, Taylor & Francis Journals, vol. 15(6), pages 489-494.
    • Handle: RePEc:taf:apeclt:v:15:y:2008:i:6:p:489-494
    DOI: 10.1080/13504850600675443
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    1. Hall, Robert E, 1978. "Stochastic Implications of the Life Cycle-Permanent Income Hypothesis: Theory and Evidence," Journal of Political Economy, University of Chicago Press, vol. 86(6), pages 971-987, December.
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    4. Mamingi, Nlandu, 1997. "Saving-investment correlations and capital mobility: The experience of developing countries," Journal of Policy Modeling, Elsevier, vol. 19(6), pages 605-626, December.
    5. Colin Allitt & Imad Moosa, 1998. "Consumption patterns as a measure of capital mobility: evidence from some APEC countries," Applied Economics, Taylor & Francis Journals, vol. 30(7), pages 885-891.
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    Cited by:

    1. Turkhan Ali Abdul Manap & Gairuzazmi M Ghani, 2012. "Malaysia's Time Varying Capital Mobility," Economics Bulletin, AccessEcon, vol. 32(2), pages 1361-1368.

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