Trade Openness and Economic Growth in Malaysia

Keshmeer Makun

Foreign Trade Review, 2017, vol. 52, issue 3, 157-170

Abstract: This study is an attempt to examine the effects of trade openness along with two other conditioning variables on economic growth in Malaysia by applying time-series econometric technique. LSE-Henry’s general to specific approach results show significant positive effect of trade openness on growth. Human capital and good economic policies tested with an interaction term increases the growth effects of trade openness. The addition of these variables and findings are significant statistically and robust to different specifications. On the basis of the findings, it is concluded that while trade openness enhance growth, decision makers should also focus on human capital development. In addition, decision makers should ensure good economic policies to take full benefit of trade openness.

Keywords: Trade openness; growth; time series approach (search for similar items in EconPapers)
JEL-codes: C32 F11 F43 (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (11)

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Persistent link: https://EconPapers.repec.org/RePEc:sae:fortra:v:52:y:2017:i:3:p:157-170

DOI: 10.1177/0015732516663317

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