Malaysian Financial Stress Index and Assessing its Impacts on the Economy

Cilt: 7 Sayı: 2 1 Haziran 2017
  • Hussin Abdullah
  • Jauhari Dahalan
  • Khaw Lee Hwei
  • Mohammed Umar
  • Md Mohan Uddin
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Malaysian Financial Stress Index and Assessing its Impacts on the Economy

Abstract

The study further investigates the link between the constructed financial stress index (FSI) and overall economic activity. We approximate the co-movement of the identified financial and economic factors into a single index using the principal component analysis. The combine variables explain about 60% of the total variation in the Malaysian FSI and practically captured the known key aspects of financial stress in Malaysia. The study further applies asymmetric causality and structural vector autoregressive to distinguish between causality in good and bad times and examine the structural impulse responses in changes in the economic activity arising from the shocks in financial stress. The study reveals that changes in the Malaysian FSI (MFSI) negatively affects the economic activity of Malaysia whereas, changes in the economic activity is positively related to the MFSI. Furthermore, the asymmetric causality indicates that high financial stress affect the economic activity during economic recession but economic activity irrespective of whether in boom or recession does not influence the MFSI. However, using the growth rate of foreign trade to proxy economic activity indicates that MFSI influences economic activity irrespective of good or bad times. Nevertheless, economic activity measured using GFD also affect MFSI during the period of economic recession. This also shows that the indicators employed in the construction of the index are the near approximation of the FSI for Malaysia due to its ability to reflect the available information included in the index. The study concludes with policy implications based on the behavior of the MFSI.

Keywords

Ayrıntılar

Birincil Dil

İngilizce

Konular

-

Bölüm

-

Yazarlar

Hussin Abdullah Bu kişi benim

Jauhari Dahalan Bu kişi benim

Khaw Lee Hwei Bu kişi benim

Mohammed Umar Bu kişi benim

Md Mohan Uddin Bu kişi benim

Yayımlanma Tarihi

1 Haziran 2017

Gönderilme Tarihi

1 Haziran 2017

Kabul Tarihi

-

Yayımlandığı Sayı

Yıl 2017 Cilt: 7 Sayı: 2

Kaynak Göster

APA
Abdullah, H., Dahalan, J., Hwei, K. L., Umar, M., & Uddin, M. M. (2017). Malaysian Financial Stress Index and Assessing its Impacts on the Economy. International Journal of Economics and Financial Issues, 7(2), 227-235. https://izlik.org/JA47TK74HW
AMA
1.Abdullah H, Dahalan J, Hwei KL, Umar M, Uddin MM. Malaysian Financial Stress Index and Assessing its Impacts on the Economy. IJEFI. 2017;7(2):227-235. https://izlik.org/JA47TK74HW
Chicago
Abdullah, Hussin, Jauhari Dahalan, Khaw Lee Hwei, Mohammed Umar, ve Md Mohan Uddin. 2017. “Malaysian Financial Stress Index and Assessing its Impacts on the Economy”. International Journal of Economics and Financial Issues 7 (2): 227-35. https://izlik.org/JA47TK74HW.
EndNote
Abdullah H, Dahalan J, Hwei KL, Umar M, Uddin MM (01 Haziran 2017) Malaysian Financial Stress Index and Assessing its Impacts on the Economy. International Journal of Economics and Financial Issues 7 2 227–235.
IEEE
[1]H. Abdullah, J. Dahalan, K. L. Hwei, M. Umar, ve M. M. Uddin, “Malaysian Financial Stress Index and Assessing its Impacts on the Economy”, IJEFI, c. 7, sy 2, ss. 227–235, Haz. 2017, [çevrimiçi]. Erişim adresi: https://izlik.org/JA47TK74HW
ISNAD
Abdullah, Hussin - Dahalan, Jauhari - Hwei, Khaw Lee - Umar, Mohammed - Uddin, Md Mohan. “Malaysian Financial Stress Index and Assessing its Impacts on the Economy”. International Journal of Economics and Financial Issues 7/2 (01 Haziran 2017): 227-235. https://izlik.org/JA47TK74HW.
JAMA
1.Abdullah H, Dahalan J, Hwei KL, Umar M, Uddin MM. Malaysian Financial Stress Index and Assessing its Impacts on the Economy. IJEFI. 2017;7:227–235.
MLA
Abdullah, Hussin, vd. “Malaysian Financial Stress Index and Assessing its Impacts on the Economy”. International Journal of Economics and Financial Issues, c. 7, sy 2, Haziran 2017, ss. 227-35, https://izlik.org/JA47TK74HW.
Vancouver
1.Hussin Abdullah, Jauhari Dahalan, Khaw Lee Hwei, Mohammed Umar, Md Mohan Uddin. Malaysian Financial Stress Index and Assessing its Impacts on the Economy. IJEFI [Internet]. 01 Haziran 2017;7(2):227-35. Erişim adresi: https://izlik.org/JA47TK74HW