Testing nonlinear convergence in Malaysia
The purpose of the present paper is to examine income convergence in Malaysia by applying the nonlinear unit root test presented by Kapetanios et al. (KSS 2003) and extended by Chong et al. (CHLL 2008) to permit the test of long-run convergence and catching-up hypotheses. The KSS-CHLL nonlinear un...
| Main Authors: | , , , |
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| Format: | Article |
| Language: | English |
| Published: |
Penerbit Universiti Kebangsaan Malaysia
2013
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| Online Access: | http://journalarticle.ukm.my/8098/ http://journalarticle.ukm.my/8098/ http://journalarticle.ukm.my/8098/1/5581-13429-1-SM.pdf |
| Summary: | The purpose of the present paper is to examine income convergence in Malaysia by applying the nonlinear unit root
test presented by Kapetanios et al. (KSS 2003) and extended by Chong et al. (CHLL 2008) to permit the test of long-run
convergence and catching-up hypotheses. The KSS-CHLL nonlinear unit root is applied to the test of nonlinear convergence
between thirteen states with respect to Wilayah Persekutuan, the richest state of Malaysia, for the period of 1965 to
2003. Generally, the results suggest that out of the thirteen states, Kedah, Negeri Sembilan, Perak, Perlis and Selangor
support the long-run convergence hypothesis; while Johor, Kelantan, Melaka, Pahang and Penang suggest catching-up.
Lastly, Sabah, Sarawak and Terengganu indicate income divergence from Wilayah Persekutuan. |
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