KESAN SUBSIDI TERHADAP OUTPUT: PENDEKATAN ARDL

This study presents empirical effects of subsidies on Malaysia s economic growth by using two set data of subsidies, namely end users and inputs subsidies. Econometric analyses show three important evidences. First, in the short-run, the government s decision to give out subsidy is influenced by national output, and vice versa. Second, the findings proved the existence of bidirectional relationship between non-subsidy public expenditure and output. Third, non-subsidy government expenditure is also influenced by the subsidies and expenditure of subsidies to consumers in the long-run. Finally, there is no significant cointegration between aggregate government spending and output in the long-run, which reflecting the important role of private sector in stimulating the nation development programs.