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Household income distribution impact of public expenditure by component in Malaysia

Harun, Mukaramah and Abdul Jalil, Ahmad Zafarullah and Abu Bakar, Nor'Aznin (2012) Household income distribution impact of public expenditure by component in Malaysia. In: 4th International Business and Social Science Research Conference , 5th to 7th January 2012 , Dubai, United Arab Emirates .

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This paper analyzes the impact of public expenditure by its components on income distribution among household sectors in Malaysia. The study on public expenditure related to income distribution is important as public expenditure has been used intensively since independence to achieve income equality goals in Malaysia. However, income inequality across ethnic groups, urban and rural areas remains wide and persistent. Income for Chinese and Indian is more than one time higher the income for Malay while income for urban is approximately double the income for rural.Using a detailed SAM framework for Malaysia constituting 50 accounts and a fixed price multiplier model, this paper highlights the difference impacts of public expenditure by different components on income distribution.Our results show that while public expenditure in education has improved inter-ethnic income inequality, it has led to a widening of rural-urban disparity. Furthermore, expenditure in agriculture and rural development are shown to have a positive impact on both inter-ethnic income inequality and rural-urban disparity.

Item Type: Conference or Workshop Item (Paper)
Additional Information: ISBN : 978-1-922069-18-4
Uncontrolled Keywords: Public expenditure, the components of public expenditure, income distribution
Subjects: H Social Sciences > HC Economic History and Conditions
Divisions: College of Arts and Sciences
Depositing User: PM Dr. Mukaramah Harun
Date Deposited: 27 May 2013 02:49
Last Modified: 27 May 2013 02:49

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