Singapore Management University
Institutional Knowledge at Singapore Management University
Dissertations and Theses Collection (Open Access) Dissertations and Theses
2009
Multifactor Productivity and Idea Transmission
Channels in the Malaysian Economy
Ester Shen Ai CHAN
Singapore Management University,
Follow this and additional works at: http://ink.library.smu.edu.sg/etd_coll
Part of the Asian Studies Commons, Growth and Development Commons, and the Labor
Economics Commons
Citation
CHAN, Ester Shen Ai. Multifactor Productivity and Idea Transmission Channels in the Malaysian Economy. (2009). Dissertations
and Theses Collection (Open Access).
Available at: http://ink.library.smu.edu.sg/etd_coll/29
This Master Thesis is brought to you for free and open access by the Dissertations and Theses at Institutional Knowledge at Singapore Management
University. It has been accepted for inclusion in Dissertations and Theses Collection (Open Access) by an authorized administrator of Institutional
Knowledge at Singapore Management University. For more information, please email .
,MULTIFACTOR PRODUCTIVITY AND IDEA TRANSMISSION
CHANNELS IN THE MALAYSIAN ECONOMY
ESTHER CHAN SHEN AI
SUBMITTED IN PARTIAL FULFILLMENT OF
THE REQUIREMENTS FOR THE DEGREE OF
MASTER OF SCIENCE IN ECONOMICS
SINGAPORE MANAGEMENT UNIVERSITY
2009
, © 2009
Esther Chan Shen Ai
All Rights Reserved
, Abstract
This paper examines the contribution of multifactor productivity (MFP) growth to output
per worker growth in Malaysia from 1961-2000. MFP growth is found to contribute
about 74 percent to output per worker growth from 1987-2000, but has only minimal or
negative contribution to growth in the earlier years.
This paper then attempts to explain why MFP growth has such a large contribution to
output per worker growth in the period 1987-2000 by looking at international trade as
channel of technology or idea transfer from the G5 countries into Malaysia. MFP grows
because ideas from these advanced nations are transferred into the economy through this
channel. Regressions using OLS are carried out on the log-linearized idea production
function. The time frame for the regressions is from 1980 to 2000. The empirical results
suggest that trade is an important channel through which technology or ideas are
transferred into Malaysia, even when other possible channels - foreign direct investment
and tertiary education of workers - are controlled for.
Institutional Knowledge at Singapore Management University
Dissertations and Theses Collection (Open Access) Dissertations and Theses
2009
Multifactor Productivity and Idea Transmission
Channels in the Malaysian Economy
Ester Shen Ai CHAN
Singapore Management University,
Follow this and additional works at: http://ink.library.smu.edu.sg/etd_coll
Part of the Asian Studies Commons, Growth and Development Commons, and the Labor
Economics Commons
Citation
CHAN, Ester Shen Ai. Multifactor Productivity and Idea Transmission Channels in the Malaysian Economy. (2009). Dissertations
and Theses Collection (Open Access).
Available at: http://ink.library.smu.edu.sg/etd_coll/29
This Master Thesis is brought to you for free and open access by the Dissertations and Theses at Institutional Knowledge at Singapore Management
University. It has been accepted for inclusion in Dissertations and Theses Collection (Open Access) by an authorized administrator of Institutional
Knowledge at Singapore Management University. For more information, please email .
,MULTIFACTOR PRODUCTIVITY AND IDEA TRANSMISSION
CHANNELS IN THE MALAYSIAN ECONOMY
ESTHER CHAN SHEN AI
SUBMITTED IN PARTIAL FULFILLMENT OF
THE REQUIREMENTS FOR THE DEGREE OF
MASTER OF SCIENCE IN ECONOMICS
SINGAPORE MANAGEMENT UNIVERSITY
2009
, © 2009
Esther Chan Shen Ai
All Rights Reserved
, Abstract
This paper examines the contribution of multifactor productivity (MFP) growth to output
per worker growth in Malaysia from 1961-2000. MFP growth is found to contribute
about 74 percent to output per worker growth from 1987-2000, but has only minimal or
negative contribution to growth in the earlier years.
This paper then attempts to explain why MFP growth has such a large contribution to
output per worker growth in the period 1987-2000 by looking at international trade as
channel of technology or idea transfer from the G5 countries into Malaysia. MFP grows
because ideas from these advanced nations are transferred into the economy through this
channel. Regressions using OLS are carried out on the log-linearized idea production
function. The time frame for the regressions is from 1980 to 2000. The empirical results
suggest that trade is an important channel through which technology or ideas are
transferred into Malaysia, even when other possible channels - foreign direct investment
and tertiary education of workers - are controlled for.
