IDEAS home Printed from https://ideas.repec.org/a/wsi/serxxx/v65y2020i01ns0217590817460018.html
   My bibliography  Save this article

Assessing The Double-Edged Sword Of Using Imitation As A Stepping Stone To Innovation: A Case Of Malaysia’S K-Economy Puzzle

Author

Listed:
  • KING YOONG LIM

    (Department of Economics, Lancaster University Management School, Bailrigg, Lancaster LA1 4YX, UK)

Abstract

Policy prescription for middle-income economies struggling to achieve innovation-driven growth has often been rapid promotion of skills-driven industrial transformation. However, Malaysia, an upper middle-income economy aspiring to achieve innovation-led growth, presents a near decade of K-Economy Growth Puzzle in the 2000s, when its aggressive skills-driven transformation initiatives had somehow resulted in decline to a lower output growth path despite successful expansion in skilled labor and innovation production. We present a continuous time growth model with industrial transformation based on an existing model advocating rapid skills transformation. By solving the model as a two-point boundary value problem, coupled with country-specific calibration strategies, vastly different results are obtained for this middle-income economy with fixed, imitation-heavy production structure. There may be a double-edged sword to using imitation as stepping stone to innovation, which then requires a much different industrial transformation approach. By examining transformation with different labor market configurations in a stylized manner using numerical experiments, we find that a delicate reordering of labor incentives would have been enough to help Malaysia navigating through the output growth–skills transformation trade-off.

Suggested Citation

  • King Yoong Lim, 2020. "Assessing The Double-Edged Sword Of Using Imitation As A Stepping Stone To Innovation: A Case Of Malaysia’S K-Economy Puzzle," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 65(01), pages 131-159, March.
  • Handle: RePEc:wsi:serxxx:v:65:y:2020:i:01:n:s0217590817460018
    DOI: 10.1142/S0217590817460018
    as

    Download full text from publisher

    File URL: http://www.worldscientific.com/doi/abs/10.1142/S0217590817460018
    Download Restriction: Access to full text is restricted to subscribers

    File URL: https://libkey.io/10.1142/S0217590817460018?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
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

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


    Cited by:

    1. James Ang, 2020. "Editorial: Special Issue On Economic Growth," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 65(01), pages 1-2, March.

    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:wsi:serxxx:v:65:y:2020:i:01:n:s0217590817460018. 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.

    We have no bibliographic references for this item. You can help adding them by using 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: Tai Tone Lim (email available below). General contact details of provider: http://www.worldscinet.com/ser/ser.shtml .

    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.