QUALITY OF HUMAN CAPITAL AND LABOR PRODUCTIVITY: A CASE OF MALAYSIA
DOI:
https://doi.org/10.31436/ijema.v23i1.289Abstract
In this study, we investigate the impacts of human capital on labor productivity in Malaysia using panel data analysis. Central to the study are the magnitudes of human capital variables, represented by educational levels and health status, on labor productivity. The panel data employed covers 14 states in Malaysia, spanning from 2009 to 2012. Results of the study are estimated using the fixed effects generalized least squares (GLS) model. The results show that human capital quality (higher educational levels and better health status) is positively significant in improving the level of labor productivity in Malaysia. Our estimates also suggest that the impact of health on labor productivity is greater than the impact of education. Improvements in the quality of health and education are therefore crucial for Malaysia to achieve higher productivity growth.
References
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Aggrey, Niringiye, Luvanda Eliab, and Shitundu Joseph. “Human Capital and Labor Productivity in East African Manufacturing Firms.†Current Research Journal of Economic Theory (2010): 48-54.
Becker, Gary S. Human Capital: A Theoretical and Empirical Analysis, with Special Reference to Education. New York: National Bureau of Economic Research, Columbia University Press, 1964.
Belorgey, Nicolas, Rémy Lecat and Tristan-Pierre Maury. “Determinants of Productivity per Employee: An Empirical Estimation Using Panel Data.†Economics Letters 91 (2006): 153-57.
Bloom, David E, David Canning, and Jaypee Sevilla. “The Effect of Health on Economic Growth: A Production Function Approach.†World Development (2003): 1-13.
Bong, Kwon Dae. “Human Capital and its Measurements.†OECD World Forum. Busan: OECD World Forum (2009): 1-15.
Chansarn, Supachet . “Labor Productivity Growth, Education, Health
and Technological Progress: A Cross-Country Analysis.†Economic Analysis & Policy (2010): 249-61.
Fleisher, Belton M, Yifan Hu, Haizheng Li, and Seonghoon Kim. “Economic Transition, Higher Education and Worker Productivity in China.†Journal of Development Economics (2011): 86-94.
Forbes, Matthew, Andrew, Barke, and Stewart, Turner. “The Effects
of Education and Health on Wages and Productivity.â€Productivity Commission Staff Working Paper (2010): 1-96.
Ghatak, Amrita. “Health, Labour Supply and Wages: A Critical Review of Literature.†Working Paper Series (2010): 1-26.
Greene, W. Econometric Analysis. Upper Saddle River, NJ: Prentice
Hall, 2000.
Ismail, Rahmah, and Idris Jajri. “Sources of Labour Productivity Growth in Large Scale Industries in Malaysia.†Jurnal Ekonomi Malaysia (2007): 59-75.
Jajri, Idris, and Rahmah Ismail. “Impact of Labour Quality on Labour Productivity and Economic Growth.†African Journal of Business Management (2010): 486-95.
Maharaja, Chandra, and Girma Zawdie. “The ‘Black Box Syndrome in Technology Transfer and the Challenge of Innovation in Developing Countries. The Case of International Joint Ventures in Malaysia.†International Journal of Technology Management & Sustainable Development 3 (2004): 233-52.
MOHE, Ministry of Higher Education. National Higher Education Action Plan 2007 - 2010. Ministry of Higher Education Malaysia, 2007.
MOE, Ministry of Education. Quick Facts 2012 Malaysia Educational Statistics. Edited by Educational Planning and Research Division: Ministry of Education Malaysia, 2012.
National Economic Advisory Council. New Economic Model for Malaysia, Part 1. Malaysia: Percetakan National Berhad, 2010.
OECD. Southeast Asian Economic Outlook 2013: Structural Policy
Country Notes, Malaysia. France: OECD, 2013.
Pelkowski, Jodi Messer, and Mark C. Berger. “The Impact of Health on Employment, Wages and Hours Worked Over the Life Cycle.†The Quarterly Review of Economics and Finance (2004): 102-21.
Qu, Yue, and Fang Cai. “Understanding China’s Workforce Competitiveness: A Macro Analysis.†Journal of Chinese Human Resource Management 2 (2011): 8-22.
Rivera, Berta, and Luis Currais. “The Effect of Health Investment on Growth: A Causality Analysis.†International Advances in Economic Research (2003): 312-24.
Schultz, Theodore W. “Investment in Human Capital.†The American Economic Review (1961): 1-17.
Umoru, David, and Jameelah Omolara Yaqub. “Labour Productivity and Health Capital in Nigeria: The Empirical Evidence.†International Journal of Humanities and Social Science (2013): 199-221.
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Published
2015-06-01
How to Cite
Arshad, M. N. M., & Malik, Z. A. (2015). QUALITY OF HUMAN CAPITAL AND LABOR PRODUCTIVITY: A CASE OF MALAYSIA. International Journal of Economics, Management and Accounting, 23(1). https://doi.org/10.31436/ijema.v23i1.289
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