The lead-lag relationship between industrial production and international trade: Malaysian evidence

Ahmad, Syafiq and Masih, Mansur (2018): The lead-lag relationship between industrial production and international trade: Malaysian evidence.

Abstract

This paper seeks to investigate the lead-lag relationship between industrial production and international trade. The standard time series techniques are applied and Malaysia is used as a case study. We have reviewed a number of studies that analyze some other open East Asian countries such as, South Korea and Taiwan and we noticed that the relationship between these two variables in those countries is unidirectional from trade to industrial production, in the sense that trade openness tends to enhance industrial production through technological transfer. In the case of Malaysia as well, the key empirical finding of this study is that international trade is leading the industrial production like many other East Asian open economies. The results are intuitive and plausible and contain strong policy implications

• Item Type: MPRA Paper
• Language: English
• Keywords: industrial production, trade balance, productivity, economic growth, Malaysia
• Subjects: C - Mathematical and Quantitative Methods > C2 - Single Equation Models ; Single Variables > C22 - Time-Series Models ; Dynamic Quantile Regressions ; Dynamic Treatment Effect Models ; Diffusion Processes; C - Mathematical and Quantitative Methods > C5 - Econometric Modeling > C58 - Financial Econometrics; F - International Economics > F4 - Macroeconomic Aspects of International Trade and Finance > F41 - Open Economy Macroeconomics

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