Open AccessTRADE OPENNESS AND ECONOMIC GROWTH IN MALAYSIA FROM 1980-2018
Author(s) -
Khairunisah Kamsin,
James Alin,
Mori Kogid
Publication year - 2020
Publication title -
advanced international journal of banking, accounting and finance
Language(s) - English
Resource type - Journals
ISSN - 2682-8537
DOI - 10.35631/aijbaf.25005
Subject(s) - openness to experience , cointegration , unit root test , economics , foreign direct investment , unit root , augmented dickey–fuller test , wald test , test (biology) , econometrics , time series , exchange rate , monetary economics , investment (military) , macroeconomics , statistical hypothesis testing , mathematics , statistics , psychology , social psychology , paleontology , biology , politics , political science , law
This study analyses the impact of trade openness on economic growth, between 1980-2018. This study using the unit root test (ADF) and the Philip and Perron (PP) test to examine the stationary of the time series data, the ARDL test to show the cointegration and long-run relationship between variables, and the Wald test to show the short-term effect of the variables. The finding shows that all variables have a long-run relationship with economic growth and the bound test shows that foreign direct investment (FDI) and the Real Effective Exchange Rate (REER) have a positive and significant relationship with economic growth. The study also found that openness is correlated with economic growth in Malaysia.