64th ISI World Statistics Congress - Ottawa, Canada

64th ISI World Statistics Congress - Ottawa, Canada

Estimation of Production Function for Manufacturing Subsectors in Malaysia


Mrs Nur Aisyah Ruslee @ Ahmad Azam


  • R
    Rozita Misran
  • N
    Nurul Hidayah Ismail


64th ISI World Statistics Congress - Ottawa, Canada

Format: CPS Abstract

Session: CPS 56 - Statistical estimation VI

Tuesday 18 July 4 p.m. - 5:25 p.m. (Canada/Eastern)


Manufacturing is Malaysia's second-largest sector, accounting for 24.3 percent of the country's GDP in the second quarter of 2022. With many investments and new factories being set up, the sector continues to contribute to the nation’s export earnings and employment opportunities, ensuring the country’s growth despite global economic uncertainty. Recent pandemic has been a challenge to the country, leaving everyone to adapt to new standard’s, technology and digitalisation. As Malaysia approaches the digital economy and Industrial Revolution 4.0, the government need to drive the nation with the right input and resources such as capital and labour in order to maintain the manufacturing productivity. Hence, using Cobb-Douglas production function, this paper will study the significance of capital and labour for eight subsectors of the manufacturing industry in Malaysia and examine the relationship between labour, capital and output of the subsectors. Data from surveys by the Department of Statistics Malaysia will be used in this study and in order to estimate the production function, the Least Square (LS) and robustness check methods are used.