The Impact of Number of Employees, Palm Production and Export of Oil Palm on Malaysia Economic Growth

Siti Nur Ain Harun; Grida Saktian Laksito

doi:10.56225/ijfeb.v1i3.59

Authors

Siti Nur Ain Harun Faculty of Business, Economics and Social Development, Universiti Malaysia Terengganu, Malaysia
Grida Saktian Laksito Faculty of Business, Economics and Social Development, Universiti Malaysia Terengganu, Malaysia

DOI:

https://doi.org/10.56225/ijfeb.v1i3.59

Keywords:

number of workers, palm fruit production, export of palm oil, gross domestic product

Abstract

The agriculture sector in Malaysia especially for oil palm agriculture is the largest exporter and supplier after Indonesia the main source that contributes towards Gross Domestic Product (GDP). Growing oil palm agriculture provides the potential and opportunities to increase economic yields and create job opportunities for local people, especially those in rural areas. This study was conducted to examine the impact of the number of workers, palm fruit production and export of palm oil on GDP in Malaysia in terms of long and short term. To achieve the objectives of the study, the researcher has used a sample of secondary data from the Department of Statistics Malaysia from 1974 to 2019, which is 45 years using Time Series data. To identify the stationary of the variables, the Augmented Dickey-Fuller (ADF) test was used. To identify long-term relationships, the Long Run Bound Test (LRBT) was used. Meanwhile, to identify the short-term relationship, the Error Correction Model (ECM) method also was used in this study. The results of the ADF test was found that all the variables studied: the number of workers, palm fruit production and pal oil export were stationary. The effects of the variables in the agriculture sector have been given attention by the local government. Therefore, policy makers can use the result to improve existing economic policies as a measure to expand the country’s income sources in palm oil agriculture field and serve as a reference for stimulate country’s economic.

References

Abdallah, M. Ben, Farkas, M. F., & Lakner, Z. (2020). Analysis of meat price volatility and volatility spillovers in Finland. Agricultural Economics, 66(2), 84–91.

Abdul-Rahman, A., & Janor, H. (2020). Perubahan Makroekonomi, Persaingan Harga Barang Pengganti dan Eksport Sawit Malaysia. Jurnal Ekonomi Malaysia, 54(1), 193–211.

Alam, A. F., Er, A. C., & Begum, H. (2015). Malaysian oil palm industry: Prospect and problem. Journal of Food, Agriculture & Environment, 13(2), 143–148.

Amelia, L., Wahab, D. A., & Hassan, A. (2008). Pembangunan Model Pengoptimuman Pengeluaran Minyak Sawit dan Isirong Sawit Menggunakan Pendekatan Genetik Kabur. Jurnal Teknologi, 48(1), 71–89.

Aziz, M. A., Din, B. H., & Abdulsomad, K. (2018). The contribution of localization management system on zakat institution performance. International Journal of Supply Chain Management, 7(1), 201–208.

Bala, U., Yakubu, Y., & Manu, S. B. (2015). Does Inflation Lead to Currency Depreciation in Nigeria? An Autoregressive Distributed Lag Approach (ARDL) Bound Testing. International Journal of Education and Social Science Research, 1(2), 49–59.

Basri, M. (2012). Bab 4: Kaedah Kajian (pp. 105–134).

El Pebrian, D., Yahya, A., & Siang, T. C. (2014). Workers’ workload and productivity in oil palm cultivation in Malaysia. Journal of Agricultural Safety and Health, 20(4), 235–254.

García-Terán, C., Tejero-Monzón, I., & Gil-Díaz, J. L. (2019). Sustainable urban drainage systems: a tool to adapt combined sewer systems to climate change. Proceedings of the Institution of Civil Engineers-Municipal Engineer, 172(3), 175–184.

Goundar, S. (2012). Research methodology and research method. Victoria University of Wellington.

Haryono, S., Supardi, S., & Udin, U. (2020). The effect of training and job promotion on work motivation and its implications on job performance: Evidence from Indonesia. Management Science Letters, 10(9), 2107–2112.

Ismail, R., & Sulaiman, N. (2007). Technical efficiency in Malay manufacturing firms. International Journal of Business and Society, 8(2), 47–62.

John, I., Magdalene, A.-M., Tarmizi, S. S. S., & Shirley, J. T. (2019). A Model to Manage Crude Palm Oil Production System. MATEC Web of Conferences, 255, 2001.

Kusairi, S., Sanusi, N. A., Muhamad, S., Shukri, M., & Zamri, N. (2019). Financial Households’efficacy, Risk Preference, and Saving Behaviour: Lessons from Lower-Income Households In Malaysia. Economics & Sociology, 12(2), 301–318.

Mansor, K. N., Halim, M. A. M., Ali, N., Rahman, W., & Abdullah, S. B. (2019). Integrating ILS in dissolving palm fruit cellulose. IOP Conference Series: Materials Science and Engineering, 702(1), 12013.

Mantalos, P. (2011). Three different measures of sample skewness and kurtosis and their effects on the Jarque Bera test for normality. International Journal of Computational Economics and Econometrics, 2(1), 47–62.

Mohd-Nor, D., Ramli, N., Sharuddin, S. S., Hassan, M. A., Mustapha, N. A., Ariffin, H., Sakai, K., Tashiro, Y., Shirai, Y., & Maeda, T. (2019). Dynamics of microbial populations responsible for biodegradation during the full-scale treatment of palm oil mill effluent. Microbes and Environments, 34(2), 121–128.

Muda, K., & Ezechi, E. H. (2019). Overview of trends in crude palm oil production and economic impact in Malaysia. Sriwijaya Journal of Environment, 4(1), 19–26.

Nkoro, E., & Uko, A. K. (2016). Autoregressive Distributed Lag (ARDL) cointegration technique: application and interpretation. Journal of Statistical and Econometric Methods, 5(4), 63–91.

Otieno, N. E., Dai, X., De Barba, D., Bahman, A., Smedbol, E., Rajeb, M., & Jaton, L. (2016). Palm oil production in Malaysia: An analytical systems model for balancing economic prosperity, forest conservation and social welfare. Agricultural Sciences, 7(2), 55–69.

Perissinotto, R. M., Monte Verde, W., Biazussi, J. L., de Castro, M. S., & Carlos Bannwart, A. (2019). Experimental Analysis on the Velocity of Oil Drops in Oil–Water Two-Phase Flows in Electrical Submersible Pump Impellers. Journal of Offshore Mechanics and Arctic Engineering, 141(4).

Pujiati, R. (2018). Analysis of The Impact of Free Trade Agreements Policy on International Palm Oil Trade Flows. Jurnal Wacana Kinerja: Kajian Praktis-Akademis Kinerja Dan Administrasi Pelayanan Publik, 20(2), 53–70.

Rasiah, R., & Shahrin, A. (2006). Development of palm oil and related products in Malaysia and Indonesia. University of Malaya, 1–54.

Roslan, S., Rizaudin, S. M., Hasnain, A., Imran, M. I., Fadzil, A., & Izmi, I. C. M. (2007). Preliminary study on GPRS throughput at Northern Region of Malaysia BSC network. 2007 Asia-Pacific Conference on Applied Electromagnetics, 1–5.

Seng, K. W. K., Shamsudin, M. N., & Hameed, A. A. A. (2012). The economics of Malaysian palm oil production, marketing, and utilization. In Palm Oil (pp. 211–233). Elsevier.

Siregar, K., Tambunan, A. H., Irwanto, A. K., Wirawan, S. S., & Araki, T. (2015). A comparison of life cycle assessment on oil palm (Elaeis guineensis Jacq.) and physic nut (Jatropha curcas Linn.) as feedstock for biodiesel production in Indonesia. Energy Procedia, 65, 170–179.

Susila, J., Rameli, M., Arifin, I., Fatoni, A., Hady, M. A., & Prihandono, R. (2016). Noise Tolerable PID Controller for Load Frequency Control (LFC) in Multi Area Power Plant. Journal of Instrumentation, Automation and Systems, 2(3), 101–106.

Susila, W. R. (2004). Contribution of oil palm industry to economic growth and poverty alleviation in Indonesia. Jurnal Litbang Pertanian, 23(3), 107–114.

Szulczyk, K. R. (2013). The economics of the Malaysian palm oil industry and its biodiesel potential. SSRN Electronic Version, 2013, 1–18.

Uyanık, G. K., & Güler, N. (2013). A study on multiple linear regression analysis. Procedia-Social and Behavioral Sciences, 106, 234–240.

Wahab, A. (2020). The state of human rights disclosure among sustainably certified palm oil companies in Malaysia. The International Journal of Human Rights, 24(10), 1451–1474.

Yusoff, M. bin. (1988). Production and trade model for the Malaysian palm-oil industry. ASEAN Economic Bulletin, 169–177.