Impact of oil price fluctuation on comparative advantage of manufacturing sectors in ASEAN-5

In the ASEAN-5 economy, the manufacturing sector contributes more than 30 percent to Gross Domestic Product and its performance affects ASEAN-5’s comparative advantage. Even though there are studies found a significant impact of oil price fluctuations on economic activities, but effect on comparativ...

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Main Author:	Noor Aida, Noh
Format:	Thesis
Language:	eng eng eng eng
Published:	2021
Subjects:	HG Finance
Online Access:	https://etd.uum.edu.my/10342/1/grant%20the%20permission_s93725.pdf https://etd.uum.edu.my/10342/2/s93725_01.pdf https://etd.uum.edu.my/10342/3/s93725_02.pdf https://etd.uum.edu.my/10342/4/s93725_references.docx
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spelling	my-uum-etd.103422023-03-01T08:31:56Z Impact of oil price fluctuation on comparative advantage of manufacturing sectors in ASEAN-5 2021 Noor Aida, Noh Azman Aziz, Mukhriz Izraf Lim, Hock Eam School of Economics, Finance & Banking School of Economics, Finance & Banking HG Finance In the ASEAN-5 economy, the manufacturing sector contributes more than 30 percent to Gross Domestic Product and its performance affects ASEAN-5’s comparative advantage. Even though there are studies found a significant impact of oil price fluctuations on economic activities, but effect on comparative advantage is largely ignored. Therefore, this study attempts to fill the gap of oil price fluctuations and comparative advantage in ASEAN-5 manufacturing sector for the period of 1991 to 2018. More specifically, it aims to evaluate the effects of oil price fluctuations on comparative advantage, the factors affecting changes in comparative advantage, and the dynamic changes in comparative advantage. The Seemingly Unrelated Regression (SURE), Probit model, Spearman rank correlation coefficient (SRC) are employed in this study. Using SURE model, oil price fluctuations adversely affect the comparative advantage of most manufacturing commodities in all technological classification of export. Results of the estimated Probit model, reveal that changes in the factors 1 (real gross domestic product, manufacturing value added, capital, foreign direct investment), factors 2 (labour, oil demand, research and development) and factors 3 (real oil price domestic, trade openness) have significant effects on the changes in comparative advantage. The findings from SRC reveal that there are dynamic changes in the rank of commodities in terms of comparative advantage. It is concluded that measuring competitiveness of manufacturing commodities using technological classification of export is crucial to focus on the products with high trade growth which could facilitate better economic growth in the future. The implementation of effective policy should be given serious consideration to ensure the comparative advantage is not affected by oil price fluctuations. ASEAN-5 needs to monitor the price of oil to ensure that unstable price will not harm the comparative advantage. 2021 Thesis https://etd.uum.edu.my/10342/ https://etd.uum.edu.my/10342/1/grant%20the%20permission_s93725.pdf text eng staffonly https://etd.uum.edu.my/10342/2/s93725_01.pdf text eng public https://etd.uum.edu.my/10342/3/s93725_02.pdf text eng public https://etd.uum.edu.my/10342/4/s93725_references.docx text eng public other doctoral Universiti Utara Malaysia
institution	Universiti Utara Malaysia
collection	UUM ETD
language	eng eng eng eng
advisor	Azman Aziz, Mukhriz Izraf Lim, Hock Eam
topic	HG Finance
spellingShingle	HG Finance Noor Aida, Noh Impact of oil price fluctuation on comparative advantage of manufacturing sectors in ASEAN-5
description	In the ASEAN-5 economy, the manufacturing sector contributes more than 30 percent to Gross Domestic Product and its performance affects ASEAN-5’s comparative advantage. Even though there are studies found a significant impact of oil price fluctuations on economic activities, but effect on comparative advantage is largely ignored. Therefore, this study attempts to fill the gap of oil price fluctuations and comparative advantage in ASEAN-5 manufacturing sector for the period of 1991 to 2018. More specifically, it aims to evaluate the effects of oil price fluctuations on comparative advantage, the factors affecting changes in comparative advantage, and the dynamic changes in comparative advantage. The Seemingly Unrelated Regression (SURE), Probit model, Spearman rank correlation coefficient (SRC) are employed in this study. Using SURE model, oil price fluctuations adversely affect the comparative advantage of most manufacturing commodities in all technological classification of export. Results of the estimated Probit model, reveal that changes in the factors 1 (real gross domestic product, manufacturing value added, capital, foreign direct investment), factors 2 (labour, oil demand, research and development) and factors 3 (real oil price domestic, trade openness) have significant effects on the changes in comparative advantage. The findings from SRC reveal that there are dynamic changes in the rank of commodities in terms of comparative advantage. It is concluded that measuring competitiveness of manufacturing commodities using technological classification of export is crucial to focus on the products with high trade growth which could facilitate better economic growth in the future. The implementation of effective policy should be given serious consideration to ensure the comparative advantage is not affected by oil price fluctuations. ASEAN-5 needs to monitor the price of oil to ensure that unstable price will not harm the comparative advantage.
format	Thesis
qualification_name	other
qualification_level	Doctorate
author	Noor Aida, Noh
author_facet	Noor Aida, Noh
author_sort	Noor Aida, Noh
title	Impact of oil price fluctuation on comparative advantage of manufacturing sectors in ASEAN-5
title_short	Impact of oil price fluctuation on comparative advantage of manufacturing sectors in ASEAN-5
title_full	Impact of oil price fluctuation on comparative advantage of manufacturing sectors in ASEAN-5
title_fullStr	Impact of oil price fluctuation on comparative advantage of manufacturing sectors in ASEAN-5
title_full_unstemmed	Impact of oil price fluctuation on comparative advantage of manufacturing sectors in ASEAN-5
title_sort	impact of oil price fluctuation on comparative advantage of manufacturing sectors in asean-5
granting_institution	Universiti Utara Malaysia
granting_department	School of Economics, Finance & Banking
publishDate	2021
url	https://etd.uum.edu.my/10342/1/grant%20the%20permission_s93725.pdf https://etd.uum.edu.my/10342/2/s93725_01.pdf https://etd.uum.edu.my/10342/3/s93725_02.pdf https://etd.uum.edu.my/10342/4/s93725_references.docx
_version_	1776103795493699584

Impact of oil price fluctuation on comparative advantage of manufacturing sectors in ASEAN-5

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