THE DETERMINANTS OF TOTAL FACTOR PRODUCTIVITY IN THE MALAYSIAN AUTOMOTIVE INDUSTRY: ARE GOVERNMENT POLICIES UPGRADING TECHNOLOGICAL CAPACITY?

Kozo Otsuka () and Kaoru Natsuda
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Kozo Otsuka: College of International Management, Ritsumeikan Asia Pacific University, 1-1 Jumonjibaru, Beppu-shi Oita, 874-8577, Japan
Kaoru Natsuda: College of International Management, Ritsumeikan Asia Pacific University, 1-1 Jumonjibaru, Beppu-shi Oita, 874-8577, Japan

The Singapore Economic Review (SER), 2016, vol. 61, issue 04, 1-18

Abstract: This paper examines the determinants of total factor productivity (TFP) in the Malaysian automotive industry, focusing on the effectiveness of government policies. Our panel data analysis shows that the productivity of the automotive industry in Malaysia highly depends on the technology embodied within imports. Government policies have not contributed to the technological upgrading of the industry. The policies to protect the domestic producers from international competition and to favor bumiputra firms seem to have adverse impacts on productivity.

Keywords: Malaysia; automotive industry; total factor productivity; R&D; government policies (search for similar items in EconPapers)
Date: 2016
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DOI: 10.1142/S0217590815500460

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