tag:blogger.com,1999:blog-6297413898275266606.post3111136255128870498..comments2024-03-27T18:15:59.096+08:00Comments on Economics Malaysia: BNM Annual Report 2013hishamhhttp://www.blogger.com/profile/06265308095732759923noreply@blogger.comBlogger22125tag:blogger.com,1999:blog-6297413898275266606.post-74489987872742256082014-09-04T09:42:15.879+08:002014-09-04T09:42:15.879+08:00@aidan
Taxes at the aggregate level are much lowe...@aidan<br /><br />Taxes at the aggregate level are much lower than that - about 11%. But the (pure) capital share you surmise is pretty accurate. The missing 10% goes to "mixed income" which represents non-corporate business owners, which covers everything from burger stalls to partnerships like PwC.hishamhhttps://www.blogger.com/profile/06265308095732759923noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-30752260846974557912014-08-31T17:43:57.563+08:002014-08-31T17:43:57.563+08:00Many thanks. Is the capital share of Malaysia'...Many thanks. Is the capital share of Malaysia's GDP around 48%? (I assume taxes are around 20%)aidanhttps://www.blogger.com/profile/18133661460280738921noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-27753594065507415752014-05-27T16:03:47.281+08:002014-05-27T16:03:47.281+08:00aidan,
It's not easily accessible, nor is it ...aidan,<br /><br />It's not easily accessible, nor is it up to date:<br /><br />http://www.statistics.gov.my/portal/index.php?option=com_content&view=article&id=1568&Itemid=111&lang=en<br /><br />The published data is only for 2006-2009. I've seen estimates for previous years elsewhere, but I can't recall where at the moment. If I remember, I'll post it.hishamhhttps://www.blogger.com/profile/06265308095732759923noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-10556392927332130252014-05-27T15:11:32.448+08:002014-05-27T15:11:32.448+08:00Dear Hisham,
Where does one get data on wage shar...Dear Hisham,<br /><br />Where does one get data on wage share of GDP for the past 10 years for Malaysia? DoS doesn't seem to provide this data.aidanhttps://www.blogger.com/profile/18133661460280738921noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-67783418578660358132014-03-24T19:13:52.956+08:002014-03-24T19:13:52.956+08:00@Olek,
1. Approximately 10%, although growth cont...@Olek,<br /><br />1. Approximately 10%, although growth contribution has effectively been negative for the past decade or so, and sharply negative in the 1980s. Reliance on natural resources is precisely the reason why Malaysia has fallen behind countries such as Korea and Taiwan.<br /><br />2. Income level and income growth are two different things. Japan has made essentially no progress in the hishamhhttps://www.blogger.com/profile/06265308095732759923noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-86395600398583679462014-03-24T17:24:57.105+08:002014-03-24T17:24:57.105+08:00In Malaysia's case, what will happen if you ta...In Malaysia's case, what will happen if you take Petronas out of the picture? Will there be a significant GDP hit?<br /><br />Japan and Singapore are examples of rich developed countries that also have rapidly ageing populations.<br /><br />Yet, by judicious imports (at least in Singapore's case) of foreign labour and talent, such a country can manage to stay ahead of the development Olek Skilgannonnoreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-276941634543343742014-03-24T17:18:02.620+08:002014-03-24T17:18:02.620+08:00@Olek,
I've always had a jaundiced view of a ...@Olek,<br /><br />I've always had a jaundiced view of a "high-productivity" economy.<br /><br />But classification is straightforward:<br /><br />http://data.worldbank.org/about/country-classifications/country-and-lending-groupshishamhhttps://www.blogger.com/profile/06265308095732759923noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-1506708310177982862014-03-24T17:16:41.443+08:002014-03-24T17:16:41.443+08:00@Zuo De
I don't think Malaysia is in a middle...@Zuo De<br /><br />I don't think Malaysia is in a middle income trap, not that middle income traps don't exist at all.<br /><br />Consider Thailand though. Relative to US living standards, GDP per capita is still below the ratio it reached in the mid-1990s. Unlike Malaysia, Thailand is well past the demographic dividend stage - there's no growth boost from a lower dependency ratio. hishamhhttps://www.blogger.com/profile/06265308095732759923noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-38251385120871659172014-03-24T17:04:08.331+08:002014-03-24T17:04:08.331+08:00Jason,
I agree that demographics are probably a m...Jason,<br /><br />I agree that demographics are probably a major factor, but I don't want to depend on Malaysia's own experience to over-generalise. Our employee compensation ratio to GDP has been more or less constant since 1970. In the sense that the LFPR will be increasing going forward, that would support a scenario of relatively lower growth in individual wages.<br /><br />But I'hishamhhttps://www.blogger.com/profile/06265308095732759923noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-49963479102138670202014-03-24T16:49:09.889+08:002014-03-24T16:49:09.889+08:00Hisham and anon,
Maybe I can offer an alternative...Hisham and anon,<br /><br />Maybe I can offer an alternative (or more crazy) view. This could be a demographic dividend playing out. Our trend in the age-dependency and employment-to-population ratios suggests that there are a lot more workers now relative to the previous generation. Average real wages may stagnate in this type of scenario.<br /><br />But I'd like to play around more with theJasonhttps://www.blogger.com/profile/03517459200735545587noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-35606075827721780142014-03-24T15:42:45.530+08:002014-03-24T15:42:45.530+08:00How do you define "middle income" anyway...How do you define "middle income" anyway?<br /><br />And just what is a "high wage high skills economy"? Economics gobbledygook or a logical extrapolation of current trends (free markets, globalisation, the " information economy " etc)?Olek Skilgannonnoreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-16256099081851397092014-03-24T13:41:16.069+08:002014-03-24T13:41:16.069+08:00Hishamh,
You have mentioned before there is no su...Hishamh,<br /><br />You have mentioned before there is no such thing as a middle income trap, why Thailand is in one?<br /><br />Zuo DeAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-74615175094492847402014-03-24T09:41:32.892+08:002014-03-24T09:41:32.892+08:00Hafiz,
Economic history littered with lessons tha...Hafiz,<br /><br />Economic history littered with lessons that have had to be relearnt, of recurring financial crises, of dead economic ideas coming back to life (or vice versa). Take Glass-Steagall for instance.<br /><br />Modern financial systems are, to borrow the <a href="http://www.amazon.com/Fragile-Design-Political-Princeton-Economic/dp/0691155240" rel="nofollow">book title</a>, fragile by hishamhhttps://www.blogger.com/profile/06265308095732759923noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-74379428098964823332014-03-23T16:22:04.766+08:002014-03-23T16:22:04.766+08:00I donno if I agree with the Minsky moment for Mala...I donno if I agree with the Minsky moment for Malaysia just because the current leadership is retiring. I think the new generation will hold the view that the financial sector matters to macro stability, whereas previous, especially before the 2009, I think the conventional wisdom was that finance didn't matter much.<br /><br />The newer generation will rise up with the mentality that financeHafiz Noor Shamshttp://maddruid.comnoreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-49229665912038628502014-03-21T18:27:58.337+08:002014-03-21T18:27:58.337+08:00@anon 3.33
If I were to statistically test the hy...@anon 3.33<br /><br />If I were to statistically test the hypothesis that labour share is related to income levels, it would fail abysmally. Labour shares for almost all countries I've seen are relatively constant across time, and countries with similar income and productivity levels can have very different employee compensation shares.<br /><br />Just for example, Taiwan and Singapore have hishamhhttps://www.blogger.com/profile/06265308095732759923noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-72316267506912433072014-03-21T15:37:41.784+08:002014-03-21T15:37:41.784+08:00Apologies for the typo as Im using an ancient tabl...Apologies for the typo as Im using an ancient tablet, in the first part I meant that this low share of wages to GDP reflects the claim of a middle income trap situation. Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-50854048304830746492014-03-21T15:33:46.887+08:002014-03-21T15:33:46.887+08:00Id like to request you to give an opinion with reg...Id like to request you to give an opinion with regsrds this issue. Apparently wages in Malaysia is considered abysmal that share of eages of GDP is small and is a reflection of the middle income. This is is supported by claim that 78% of EPF contributors earns RM3000 below(or maybe just as you a majority of contributors are entry level workers) while the minimum wage earner can only earn 26% of Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-14960000364036770862014-03-21T09:34:19.432+08:002014-03-21T09:34:19.432+08:00@anon 1.01
The latest number is 32%.
I disagree ...@anon 1.01<br /><br />The latest number is 32%.<br /><br />I disagree with the notion that the low number is indicative of low productivity. There are countries at similar labour shares, with wildly different productivity levels. If productivity was the main cause, I would expect to see the labour share gradually improve over time, but that's not what we see here in Malaysia or elsewhere.<br hishamhhttps://www.blogger.com/profile/06265308095732759923noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-33504316255968050492014-03-21T09:20:06.245+08:002014-03-21T09:20:06.245+08:00@anon
I don't see any reason to raise it at t...@anon<br /><br />I don't see any reason to raise it at the moment. There's no evidence of any pass through of subsidy cuts into other prices (CPI should return to its former growth path); and the government's fiscal consolidation needs to be counterbalanced by softer monetary policy.<br /><br />That might change as we get into the second half, but not asthings stsnd now.hishamhhttps://www.blogger.com/profile/06265308095732759923noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-5942697427303773662014-03-21T01:01:00.614+08:002014-03-21T01:01:00.614+08:00Hi mr.hishamh, there is a concern that wages makes...Hi mr.hishamh, there is a concern that wages makes only 28% of the GDP which is lower compared to advanced economies at 30%+.This indicate low productivity and inherent weakness in the labor market. What is your take on this and will Malaysia's wage share of GDP ever increase as historically is fluctuates between 28-32%.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-35302949537620352002014-03-20T19:21:09.795+08:002014-03-20T19:21:09.795+08:00Very well written as usual. I'm concerned the ...Very well written as usual. I'm concerned the pace of 'slowing down' is insufficient and we'll be in real trouble before things start getting better. If growth rates decelerate, not only will government revenue be hamstrung, but also household debt servicing capability and stability of financial institutions. We are living on borrowed time for a recession and 2009 doesn't cheekionghttps://www.blogger.com/profile/02609944408130764057noreply@blogger.comtag:blogger.com,1999:blog-6297413898275266606.post-21716728876896234182014-03-20T13:25:04.786+08:002014-03-20T13:25:04.786+08:00Whats your take on the OPR this year. Some researc...Whats your take on the OPR this year. Some research houses have now revised their call on a 25-50 bp hike this year after the report was released.Anonymousnoreply@blogger.com