Co-movement of output and price in Malaysia: Empirical evidence and macroeconomic policy implications
This study conducts a comprehensive analysis on the output-price relationship in Malaysia with the objective of identifying the major source of macroeconomic fluctuations in Malaysia, thus drawing relevant policy recommendations for effective macroeconomic stabilization policy. We analyze the sho...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
| Published: |
Universiti Teknologi MARA Terengganu
2012
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| Online Access: | http://irep.iium.edu.my/27363/ http://irep.iium.edu.my/27363/ http://irep.iium.edu.my/27363/1/V2I2A7.CO-MOVEMENT_OF_OUTPUT_AND_PRICE_IN_MALAYSIA.pdf |
| Summary: | This study conducts a comprehensive analysis on the output-price relationship in Malaysia
with the objective of identifying the major source of macroeconomic fluctuations in Malaysia,
thus drawing relevant policy recommendations for effective macroeconomic stabilization
policy. We analyze the short- and long-run co-movements between real activity and prices
using several tests in efforts to arrive at conclusive findings. Apart from the descriptive
analysis, the study relies on the VAR forecast errors based on Den Haan and Sumner
(2000). The study considers an extended data sample of monthly frequency covering the
period from January 1971 to November 2009. The study aims to contribute towards
enriching policy recommendations for effective macroeconomic stabilization policy in the
country. |
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