Malaysia and Thailand Economic Growth

Economic growth

According to Brue & McConnell (2007), economic growth is define and measure economic growth as either an increase in real GDP occurring over time or an increase in real GDP per capita occurring over time. Therefore, a country’s growth rate is linked with how rapidly real GDP per person grows in the typical year. Economic growth however relies heavily on the factors of production of a country. On the other hand, economic growth is also the result of the increase in population or the introduction of new products and services (Kendrick, 1961).

Malaysia and Thailand qualifies as middle-income nations, and its main growth revolves around its natural resources where Malaysia is enriched with tin and petroleum as well its agricultural resources such as rubber and palm oil. Similarly, Thailand is one of the largest producers of rice in the world along with other agricultural produce. The abundance of natural resources may well be one of the key factors that help the growth of economy in these regions.

Also, the increase in the quantity and quality of human labor will result in economic growth as it relates to a country’s productivity level. Labor quality can be maximized through the improvement in the country’s educational system and training. Apart from natural resources, population growth reflects a steady influx of immigrant labor (Yusof & Bhattasali, 2008). For example, Malaysia allows immigration of foreign labors from neighboring countries such as Indonesia, Philippines, and other Asian countries such as Nepal, Bangladesh and India to work in labor-intensive industries to support its burgeoning economy.

However, to achieve consistency in economic growth, a country must seek for diversification in their productivity. As Malaysia changes from agricultural to manufacturing in mid 1982 due to National Economic Policy, assisted by the rapid rise of construction and manufacturing. This results in a marginal growth for a limited period of time...