Regional Stochastic Convergence in Malaysian Agriculture Sector

M T Hirnissa and Muzafar Shah Habibullah

The IUP Journal of Agricultural Economics, 2009, vol. VI, issue 3-4, 111-118

Abstract: For the last 25 years, Malaysia has been recognized as one of the most dynamic countries in Asia. Despite these achievements, disparity in income across states and regions in Malaysia continues to be a matter of concern. The existence of regional inequalities and the prospect that these inequalities may widen were recognized by the Malaysian government. The nine volumes of the 5-Year Malaysia Development Plans reflect the sincerity of the Malaysian government in eradicating if not elevating the problem of regional or states imbalances. Accordingly, in their quest for both development and equity at the same time, policies and strategies are continuously being formulated and implemented across the states. This paper empirically analyzes economic convergence in the agriculture sector of three regions in Malaysia, namely Peninsular Malaysia, Sabah and Sarawak. Using five different approaches of unit root tests for the testing economic convergence, it was found that the regional agriculture sectors in Malaysia do not support the hypothesis of economic convergence for the period under study.

Date: 2009
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