Open AccessInclusive Growth: Comprehensive Dimension of Income Distribution
Author(s) -
Che Sulaiman Nor Fatimah,
Mohd Fahmee Ab-Hamid,
Abdul Rahim Ridzuan
Publication year - 2021
Publication title -
èkonomika regiona
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.377
H-Index - 14
eISSN - 2411-1406
pISSN - 2072-6414
DOI - 10.17059/ekon.reg.2021-1-23
Subject(s) - distribution (mathematics) , income distribution , inclusive growth , index (typography) , economics , investment (military) , government (linguistics) , inequality , dimension (graph theory) , economic inequality , economic growth , development economics , demographic economics , public economics , poverty , political science , mathematics , politics , mathematical analysis , linguistics , philosophy , world wide web , computer science , pure mathematics , law
The article aims to solve the problem of unequal income distribution in Malaysia. Income inequality did not change significantly since 1990. Inclusive growth is an alternative way that can help the government overcome the unequal distribution of income. However, there are no measurements or detailed studies conducted in Malaysia. Moreover, the country’s distribution policy for the 2016–2030 period focuses on inclusive economic growth. Based on the above gaps, we constructed the Malaysia Inclusive Index and estimated the income distribution using this new composite index. To construct the index, we applied the Z-score method. We obtained data for this study from the World Development Indicator, Economic Planning Unit, Department of Statistics, Malaysia and annual reports from various ministries. The main research findings show yearon-year growth from 1990 to 2016, indicating that economic growth in Malaysia is increasingly inclusive. Therefore, to achieve inclusive and equitable economic growth in distribution, the government is advised to consider not only fiscal aspects, but also holistic components comprised of education, health, housing and employment of the B40 group (lower class). Simultaneously, the M40 group (middle class) should not be left out. Income distribution factors and the Malaysia Inclusive Index (MII) determinants such as investment, inflation, education and national income should be considered when developing national distribution policies, as these factors are crucial for inclusive growth in Malaysia