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Fiscal sustainability: an empirical investigation in Sarawak


Lau, Evan Poh Hock and Tiong, Magdalene Hua Ling and Ling, Jeffrey (2009) Fiscal sustainability: an empirical investigation in Sarawak. International Journal of Economics and Management, 3 (1). pp. 62-72. ISSN 1823-836X


This paper examines the fiscal sustainability condition for Sarawak during 1971 to 2004. We also split the sample period into the pre-crisis (1971-1996) to investigate the disparities between the two empirical samples. Empirical validation from the time series analysis finds that government revenue, government expenditure and Gross domestic Product (GDP) are cointegrated, which provides some support for the position that Sarawak’s budget deficit is sustainable in the long run in both sampling periods. The results also found support for coefficient of expenditure being unity in both periods. This finding suggests that reducing the size of government spending may improve fiscal budget deficits without having to undergo changes in the overall strategy.

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Official URL or Download Paper: http://econ.upm.edu.my/ijem/vol3_no1.htm

Additional Metadata

Item Type: Article
Divisions: Faculty of Economics and Management
Publisher: Faculty of Economics and Management, Universiti Putra Malaysia
Keywords: Fiscal sustainability; Revenue; Expenditure; GDP; Sarawak
Depositing User: Nabilah Mustapa
Date Deposited: 03 Aug 2015 04:28
Last Modified: 03 Aug 2015 04:28
URI: http://psasir.upm.edu.my/id/eprint/39446
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