Martin Ravallion, 15 April 2019

It is 50 years since the Sino-Malay race riots in Kuala Lumpur prompted a policy effort to reduce Malaysia’s longstanding ethnic inequalities. This column argues that while reduced ethnic/racial disparities in living standards has played an important role in the country's ability to manage overall relative inequality and in its impressive progress against poverty over the last 50 years, overall economic growth has been more important. However, the potential gains to poor Malaysians from progress toward ethnic equality do not appear to have been exhausted yet. 

Jayant Menon, Thiam Ng, 01 October 2015

Malaysia’s fortunes have taken a turn for the worse in recent years, both in manufacturing and across the economy in general. This column argues that the country is moving back to processing its agricultural and mineral resources, and that such ‘premature deindustrialisation’ is mostly policy driven. The biggest concern with such structural shifts is that they lead to low-productivity, low-wage manufacturing. Malaysia must address these issues and improve its business environment if it wants to realise its aspirations.

Aaron Flaaen, Ejaz Ghani, Saurabh Mishra, 22 July 2013

Many developing countries are stuck in the middle-income gap. Focusing on Malaysia, this column argues that countries trapped in the middle-income conundrum will need to expand their ‘modern’ sectors. Traditional sectors with low productivity must shed labour, and high-productivity modern sectors (be they in goods or services) must hire more labour if they want to grow.

Carmen Reinhart, Kenneth Rogoff, Nicolas Magud, 24 March 2011

Capital controls are back on the table. But the existing literature offers conflicting and sometimes confusing insights. This column provides a meta-analysis of 37 empirical studies with the aim of exposing some common ground. It finds that capital controls on inflows make monetary policy more independent, alter the composition of capital flows, reduce real-exchange-rate pressures, but they do not reduce the volume of net flows.

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