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Subsidy and export: Malaysian case

Author

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  • Abu Mansor, Shazali
  • Abdul Karim, Bakri

Abstract

This paper examines the long-run relationship between subsidies and export for the case of Malaysia using annual data from 1976 to 2010 and cointegration test. The results show that the subsidies significantly influence export in the long-run. This support the argument by the non-neo-classical economists’ propagation that export promotion requires a pro-active government role in the economy. This study has shed some lights that subsidy may not be detrimental to an economy.

Suggested Citation

  • Abu Mansor, Shazali & Abdul Karim, Bakri, 2011. "Subsidy and export: Malaysian case," MPRA Paper 37025, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:37025
    as

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    File URL: https://mpra.ub.uni-muenchen.de/37025/1/MPRA_paper_37025.pdf
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    References listed on IDEAS

    as
    1. Johansen, Soren & Juselius, Katarina, 1990. "Maximum Likelihood Estimation and Inference on Cointegration--With Applications to the Demand for Money," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 52(2), pages 169-210, May.
    2. Barbara J. Spencer & James A. Brander, 1983. "International R & D Rivalry and Industrial Strategy," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 50(4), pages 707-722.
    3. Collie, David, 1991. "Export subsidies and countervailing tariffs," Journal of International Economics, Elsevier, vol. 31(3-4), pages 309-324, November.
    4. Toda, Hiro Y. & Yamamoto, Taku, 1995. "Statistical inference in vector autoregressions with possibly integrated processes," Journal of Econometrics, Elsevier, vol. 66(1-2), pages 225-250.
    5. George Mavrotas & Roger Kelly, 2001. "Old Wine in New Bottles: Testing Causality between Savings and Growth," Manchester School, University of Manchester, vol. 69(s1), pages 97-105.
    6. Ejaz Ghani, 1992. "How Significant are Externalities for Development?," Palgrave Macmillan Books, in: North-South and South-South, chapter 6, pages 118-161, Palgrave Macmillan.
    7. repec:bla:manchs:v:69:y:2001:i:0:p:97-105 is not listed on IDEAS
    8. Brander, James A. & Spencer, Barbara J., 1985. "Export subsidies and international market share rivalry," Journal of International Economics, Elsevier, vol. 18(1-2), pages 83-100, February.
    9. Johansen, Soren, 1992. "Testing weak exogeneity and the order of cointegration in UK money demand data," Journal of Policy Modeling, Elsevier, vol. 14(3), pages 313-334, June.
    10. David de Meza, 1986. "Export Subsidies and High Productivity: Cause or Effect?," Canadian Journal of Economics, Canadian Economics Association, vol. 19(2), pages 347-350, May.
    11. Johansen, Soren, 1988. "Statistical analysis of cointegration vectors," Journal of Economic Dynamics and Control, Elsevier, vol. 12(2-3), pages 231-254.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Subsidies; Export; Cointegration;
    All these keywords.

    JEL classification:

    • F40 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - General
    • H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies
    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes

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