The effects of macroeconomics and financial stability on purchasing power competitiveness in Malaysia and Thailand

In order to align its economic development with the pillar objectives of ASEAN Economic Community 2025, ASEAN members, especially Malaysia and Thailand , need to ensure the macroeconomic and financial factors are stable, controlled, and support all their development plans. The purchasing power compe...

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Main Author:	Abu Bakar, Mohd Jaffri
Format:	Thesis
Language:	English
Published:	2022
Subjects:	HG Finance
Online Access:	http://eprints.utm.my/108291/1/MohdJaffriAbuBakarPAHIBS2022.pdf.pdf
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id	my-utm-ep.108291
record_format	uketd_dc
spelling	my-utm-ep.1082912024-11-01T02:58:08Z The effects of macroeconomics and financial stability on purchasing power competitiveness in Malaysia and Thailand 2022 Abu Bakar, Mohd Jaffri HG Finance In order to align its economic development with the pillar objectives of ASEAN Economic Community 2025, ASEAN members, especially Malaysia and Thailand , need to ensure the macroeconomic and financial factors are stable, controlled, and support all their development plans. The purchasing power competitiveness becomes a crucial factor in the global economic environment because the world is connected in trade, finance, and social aspects. This study investigates the impact of macroeconomic and financial stability on purchasing power competitiveness in Malaysia and Thailand between January 1994 and March 2020. The multilateral exchange rate, trade openness, world oil prices, overnight policy rate, stock market index, and world crude palm oil prices are considered in this study. Firstly, the traditional and nonlinear unit root tests were employed to validate the hypothesis of purchasing power parity. Secondly, the study applied the nonlinear Autoregressive Distributed Lag (NARDL) in proving the existence of the nonlinear structure and serial independence in the variable's series data. Furthermore, the study utilized the nonlinear Hatemi-J causality to prove the variables' positive and negative causality effects. The study's findings confirmed evidence of an asymmetric relationship between the variables, and nonlinear causality verified a bidirectional relationship. Therefore, a change in any of these macroeconomic and financial variables, whether the trade openness, world oil prices, overnight policy rate, stock market index or crude palm oil prices, would influence the purchasing power competitiveness in Malaysia and Thailand in the long-run and short-run. Therefore, the policymakers in both countries should consolidate and reconsider an underlying policy and strategies to stabilize the value of purchasing power competitiveness and vice versa, as targeted. 2022 Thesis http://eprints.utm.my/108291/ http://eprints.utm.my/108291/1/MohdJaffriAbuBakarPAHIBS2022.pdf.pdf application/pdf en public http://dms.library.utm.my:8080/vital/access/manager/Repository/vital:154389 phd doctoral Universiti Teknologi Malaysia Azman Hashim International Business School
institution	Universiti Teknologi Malaysia
collection	UTM Institutional Repository
language	English
topic	HG Finance
spellingShingle	HG Finance Abu Bakar, Mohd Jaffri The effects of macroeconomics and financial stability on purchasing power competitiveness in Malaysia and Thailand
description	In order to align its economic development with the pillar objectives of ASEAN Economic Community 2025, ASEAN members, especially Malaysia and Thailand , need to ensure the macroeconomic and financial factors are stable, controlled, and support all their development plans. The purchasing power competitiveness becomes a crucial factor in the global economic environment because the world is connected in trade, finance, and social aspects. This study investigates the impact of macroeconomic and financial stability on purchasing power competitiveness in Malaysia and Thailand between January 1994 and March 2020. The multilateral exchange rate, trade openness, world oil prices, overnight policy rate, stock market index, and world crude palm oil prices are considered in this study. Firstly, the traditional and nonlinear unit root tests were employed to validate the hypothesis of purchasing power parity. Secondly, the study applied the nonlinear Autoregressive Distributed Lag (NARDL) in proving the existence of the nonlinear structure and serial independence in the variable's series data. Furthermore, the study utilized the nonlinear Hatemi-J causality to prove the variables' positive and negative causality effects. The study's findings confirmed evidence of an asymmetric relationship between the variables, and nonlinear causality verified a bidirectional relationship. Therefore, a change in any of these macroeconomic and financial variables, whether the trade openness, world oil prices, overnight policy rate, stock market index or crude palm oil prices, would influence the purchasing power competitiveness in Malaysia and Thailand in the long-run and short-run. Therefore, the policymakers in both countries should consolidate and reconsider an underlying policy and strategies to stabilize the value of purchasing power competitiveness and vice versa, as targeted.
format	Thesis
qualification_name	Doctor of Philosophy (PhD.)
qualification_level	Doctorate
author	Abu Bakar, Mohd Jaffri
author_facet	Abu Bakar, Mohd Jaffri
author_sort	Abu Bakar, Mohd Jaffri
title	The effects of macroeconomics and financial stability on purchasing power competitiveness in Malaysia and Thailand
title_short	The effects of macroeconomics and financial stability on purchasing power competitiveness in Malaysia and Thailand
title_full	The effects of macroeconomics and financial stability on purchasing power competitiveness in Malaysia and Thailand
title_fullStr	The effects of macroeconomics and financial stability on purchasing power competitiveness in Malaysia and Thailand
title_full_unstemmed	The effects of macroeconomics and financial stability on purchasing power competitiveness in Malaysia and Thailand
title_sort	effects of macroeconomics and financial stability on purchasing power competitiveness in malaysia and thailand
granting_institution	Universiti Teknologi Malaysia
granting_department	Azman Hashim International Business School
publishDate	2022
url	http://eprints.utm.my/108291/1/MohdJaffriAbuBakarPAHIBS2022.pdf.pdf
_version_	1818646938578321408

The effects of macroeconomics and financial stability on purchasing power competitiveness in Malaysia and Thailand

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