Income Inequality, Income Growth and Government Redistribution in Malaysia: What Do We Know in the Long Run?
: Malaysia has a good track record of reducing income inequality, especially between ethnic groups. In recent years, increasing attention has been paid to national inequality – notably by targeting the bottom 40% income group while sustaining growth with inclusivity. This paper uses the latest co...
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| Main Authors: | , , , |
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| Format: | Article |
| Language: | English |
| Published: |
2023
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| Subjects: | |
| Online Access: | http://ir.unimas.my/id/eprint/42306/1/Income%20Inequality.pdf http://ir.unimas.my/id/eprint/42306/ https://mjes.um.edu.my/index.php/MJES/article/view/44907 https://doi.org/10.22452/MJES.vol60no1.4 |
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| Institution: | Universiti Malaysia Sarawak |
| Language: | English |
| Summary: | : Malaysia has a good track record of reducing income inequality, especially
between ethnic groups. In recent years, increasing attention has been paid to national
inequality – notably by targeting the bottom 40% income group while sustaining
growth with inclusivity. This paper uses the latest cointegration technique, namely,
the augmented autoregressive distributed lag (A-ARDL) to examine the long-run
determinants of income inequality in Malaysia. The long-run results suggest that income
inequality is negatively driven by real GDP per capita and government redistribution
of income. The findings provide some possible policy implications that could reduce
income inequality in the long run, in particular, through the enhancement of the quality
and skills of the workforce, and the government’s benevolent role by using redistributive
instruments such as progressive income tax and cash transfers to low-income groups. |
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