Proceeding of the International Conference on ...

Proceedings of International Conference on Contemporary Economic Issues 2014 Stimulating Economic Growth, Improving Quality of Life & Enhancing Youth Involvement

11 - 12 December 2014 Hotel Royal, Kuala Lumpur, Malaysia

Editors Hooi Hooi Lean Ee Shiang Lim Suet Leng Khoo Saidatulakmal Mohd

Disclaimer The views and recommendations expressed by the authors are entirely their own and do not necessarily reflect the views of the editors, the school or the university. While every attempt has been made to ensure consistency of the format and the layout of the proceedings, the editors are not responsible for the content of the papers appearing in the proceedings.

Perpustakaan Negara Malaysia

Cataloging-in-Publication Data

International Conference on Contemporary Economic Issues 2014 - Stimulating Economic Growth, Improving Quality of Life & Enhancing Youth Involvement / Editors Hooi Hooi Lean, Ee Shiang Lim, Suet Leng Khoo and Saidatulakmal Mohd

ISBN 978-967-394-206-0 1. Economic growth. 2. Quality of life. 3. Youth involvement. I. Hooi Hooi Lean. II. Ee Shiang Lim. III. Suet Leng Khoo. IV. Saidatulakmal Mohd. All rights reserved.

© 2014 School of Social Sciences, USM

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Title and Authors Economic Growth and Development Economic and Demographic Determinants of Demand for Alcohol: The Case of Malaysia Yong Kang Cheah Assessment of Food Grain Crops Storage Techniques Implemented by Progressive Farmers in Punjap-Pakistan Ejaz Ashraf, Hafiz Khurram Shurjeel, Muhammad Anjum Aqueel, Muhammad Zeeshan Majeed & Muhammad Younis Afzal Financial Development and Economic Growth: A Panel Test of SupplyLeading Hypothesis from the Perspective of Sukuk Market Sabri Nayan, Norsiah Kadir & Mat Saad Abdullah Developing Securitization in Islamic Personal Financing: Evidence from Malaysia Bakri M.H., A.H. Baharom, Sufian. F, Ali. R & Ismail. S Cross-Border Mergers and Acquisitions in Developing Countries: Evidence from Panel Data Nur Syazana Mohd Nasir,Norsiah Kadir & Sabri Nayan Is there a Natural Resource Curse in Finance-Growth Nexus? The Case of Malaysia Ramez Abubakr Badeeb & Hooi Hooi Lean The Impact of International Oil Price on Electricity Consumption and Output: A Case of Manufacturing Sector in Malaysia Dzul Hadzwan Husaini & Hooi Hooi Lean Impact of Macroeconomic Volatility on Stock Market Volatility in Malaysia Geok Peng Yeap & Hooi Hooi Lean Gender Disparity in the Malaysian Labour Market Cheong Jia Qi & Jacqueline Liza Fernandez The Effects of Intellectual Capital on Dynamic Network Bank Performance Wen-Min Lu, Qian Long Kweh, Mohammad Nourani & Wei-Kang Wang Role of Education via English Language Proficiency: A Catalyst of Economic Growth in Developing Countries? O.C.S. Wilson, S. Premagowrie, A.H. Baharom & Muzafar Shah Habibullah Time Series Analysis of Inflation in Bangladesh Md. Khaled Saifullah & Yap Su Fei Export-led Growth Hypothesis: Empirical Evidence from Equatorial Guinea Chia Yee Ee The Impact of Unskilled Immigrant Workers on Manufacturing Wage by Establishment Size and Its Implications Seyed Mehrshad Parvin Hosseini & Suresh Narayanan Poverty, Education and Income Inequality in Malaysia: Evidence from the 2009 Household Income Expenditure Survey Saidatulakmal Mohd, Abdul Fatah Che Hamat, Muhammad Idris & Norfariza Hanim Kasim

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Education, Labour Productivity and Industrial Performance: Evidence of Indonesia Joko Susanto & Purwiyanta Quality of Life Founder Management and Firm Performance: Evidence from Malaysia Irene Wei Kiong Ting, Hooi Hooi Lean & Noor Azlinna Azizan The Pursuit of Happiness: Does the Economy Matter? R. Ratneswary V. Rasiah, Baharom Abdul Hamid & Muzafar Shar Habibullah Financial Risk and Risk Management of Islamic Microfinance Instrument Siti Khadijah Ab Manan, Siti Nurfarah Jaaffar, Muhammad Hakimi Mohd Shafiai, Fadhilah Abdul Rahman & Syarifah Hazera Izzati Sayid Shahrullail An Empirical Analysis of System Factor as a Critical Determinant Towards Members of Parliament Engagement with Internet Communication in Malaysia Norsyahida Zaharudin, Ahmad Naqiyuddin Bakar, Rugayah Hashim & Abdul Rauf Ambali International Tourist Demand in the Greater Mekong Sub-region Countries: A Panel ARDL Approach Sakkarin Nonthapot, Saidatulakmal Mohd & Hooi Hooi Lean Including the Urban Informal Sector in the Planning Process: A Study of Street Hawking in Dhaka, Bangladesh Abontika Sara Israt & Mastura Adam Decomposing the Relationship between Renewable Energy Sources, CO2 Emission and Per Capita GDP: ARDL Approach for OECD Countries Abdelhak Senadjki, Saidatulakmal Mohd & Thurai Murugan Nathan Cultural Landscapes in Asian Modernity Kenneth Wong See Huat Informal Networks and Informal Economic Association as Safety Nets among Low-Income Women in Penang, Malaysia Suriati Ghazali, Narimah Samat & Liong May Ling Youth and Society Perception and Preparation for Old Age: Case Studies in Kuala Lumpur, Singapore and Manila Saidatulakmal Mohd, Nor Asmat Ismail & Abdelhak Senadjki

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Preface The economic structure is experiencing transformation following the need to constantly meet the changing demand. It is important to ensure that the transformation leads to a robust and progressive economy based on the tenets of sustainable development. Sustainable development inclusive growth, equality and holistic social development, is important to enhance the standard of living of our society today. This conference stressed on both economic and social wellbeing of the society by focusing on the issues related to economic growth and development, general well-being of society as well as individuals especially the youth which makes up a great proportion of population. The theme of the conference is based on the three key priorities namely, Economic Growth and Development, Quality of Life, and Youth and Society.

The proceedings include papers presented at the International Conference on Contemporary Economic Issues (ICCEI2014) carrying the theme “Stimulating Economic Growth, Improving Quality of Life & Enhancing Youth Involvement” held on 10-12 December 2014 at Hotel Royal, Kuala Lumpur, Malaysia. This conference is jointly organized by the School of Social Sciences, Universiti Sains Malaysia (USM), Malaysia and Institute for Youth Research Malaysia. The conference benefits from generous contribution from the ASEAN - Malaysian National Secretariat, Ministry of Foreign Affairs, Malaysia.

We received a total of 58 papers from various institutions and organization around the world where 26 papers were accepted for inclusion in these proceedings. The proceedings are compiled according to the three sub themes of the conference. It covers both theoretical and empirical works from scholars globally. It is hoped that the collection of these conference papers will become a valuable reference to the conference participants, researchers, scholars, students, businesses and policy makers. The proceedings will be submitted to Thomson Reuters for Conference Proceedings Citation Index.

We would like to thank all authors and paper presenters for their invaluable contribution and support. Our sincere gratitude also goes to all paper reviewers who provided their professional views and comments. Last but not least, we honestly appreciate our editorial board members and assistances who passionately assisted in editing the proceedings.

Editors: Hooi Hooi Lean, Ee Shiang Lim, Suet Leng Khoo and Saidatulakmal Mohd December 2014

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Editorial Board

Editors Hooi Hooi Lean Ee Shiang Lim Suet Leng Khoo Saidatulakmal Mohd

Editorial Assistant Ramez Abubakr Badeeb Nurul Syifaa Mohd. Shakil Azirah Azhar

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Proceeding of the International Conference on Contemporary Economic Issues 2014

Economic and Demographic Determinants of Demand for Alcohol: The Case of Malaysia Yong Kang Cheaha a

School of Economics, Finance and Banking, College of Business, Universiti Utara Malaysia, 06010 UUM Sintok, Kedah DarulAman, Malaysia. [email protected] / [email protected]

Abstract The objective of this study is to investigate factors that affect the decisions of Malaysian adults to consume alcohol. This study used the Third National Health and Morbidity Survey (NHMS III) which has 30,992 respondents. The results from the study suggested that age, income, gender, ethnicity, education, location of residence and employment status have significant effects on alcohol consumption. In particular, younger individuals, higher income earners, males, Chinese, the well-educated, urban dwellers, civil servants, private sector employees, the self-employed and students are associated with a higher likelihood of consuming alcohol. The findings from this study call for several anti-alcohol intervention strategies. Keywords: alcohol, consumption, demand, demographics, economics 1.

Introduction

Alcohol drinking is a long-standing lifestyle, and is being adopted widely in today’s society with an estimated 6.13 litres of per capita alcohol consumption worldwide (World Health Organization, 2011). Although alcohol is generally available in the market, it cannot be characterised as a normal beverage as it can result in serious medical, psychological and social problems. In fact, alcohol consumption has become a profound public health concern, and is ranked as the third leading risk factor of disease burden in the world causing 2.5 million deaths annually (World Health Organization, 2011). In Malaysia, the official report by the Ministry of Health Malaysia stated that there was an increasing trend in the prevalence of alcohol consumption (Institute for Public Health, 2008). To be exact, the prevalence of incidences of ‘ever consumed alcohol’ had increased from 29.2% in 1996 to 42.8% in 2006. A similar trend was noted for ‘current alcohol drinkers’ with a prevalence of 23% in 1996 and 24.1% in 2006. In terms of ethnicity, the increasing trend was noted predominantly among Chinese alcohol drinkers with a prevalence of ‘current alcohol drinkers’ reported as 22.2% in 1996 and a hike to 26.6% in 2006. In view of the massive impacts of alcohol consumption on morbidity and mortality worldwide, there is a growing body of literature that examined the factors that affect alcohol consumption in developed countries (Yen, 1994; Abdel-Ghany and Silver, 1998; Manrique and Jensen, 2004; Yen, 2005; Yuan and Yen, 2012). However, the attention devoted to examining this topic in Malaysia is still lacking despite alcohol consumption has become a serious public health issue. While there are scholars like Tan, et al. (2009) who investigated 1


the determining factors of alcohol consumption in Malaysia, their study focused mainly on the total monthly household expenditure on alcoholic beverages. The likelihood of alcohol consumption by each individual was not examined in detail. To address this research gap, this study concentrates primarily on the decision of individuals to consume alcohol in Malaysia. 2.

Theoretical Basis

From the economics perspective, health is a capital good that is used to produce ‘healthy time’ (Grossman, 1972). Health determines the amount of time that individuals can spend on both market and non-market activities. Similar to other types of capital, health can depreciate over time which means that individuals will become weaker as they age. Worse still, such depreciation can ultimately lead to death when health capital falls below the minimum level (Grossman, 1972). Therefore, to reduce the depreciation of health, it is necessary to raise input of resources such as time, medical care, shelter and food. Grossman (1972) defines this as ‘health investment.’ He argues that individuals have the capability to improve their own health. Generally, people invest in health for two main reasons (Grossman, 1972). First, people have better well-being when they are healthier, thus, better health yields greater utility. Second, health increases the amount of time that people can spend on their market and non-market activities such as working, home production and leisure activities. Cawley and Ruhm (2012) advance Grossman’s (1972) health capital model and classify unhealthy behaviours such as physical inactivity, smoking and alcohol consumption as ‘negative health investment’ or ‘health disinvestment.’ They claim that participation in unhealthy behaviours can significantly depreciate health capital. 3.

Methods

3.1

Data

The present study used data from the Third National Health and Morbidity Survey (NHMS III). It was a cross-sectional population-based survey conducted by the Ministry of Health Malaysia from April 2006 to January 2007. The survey covered all urban and rural areas in the 13 states of Malaysia as well as the federal territory of Kuala Lumpur. Based on the sampling frame designed by the Department of Statistics Malaysia, a two stage stratified sampling approach proportionate to the size of population in Malaysia was used to collect the data. The first stage sampling unit was based on geographically contiguous areas of the country [Enumeration Blocks (EBs)]. The second stage sampling unit was based on the Living Quarters (LQs) in each EB, and all the individuals that resided in the selected LQs participated. In particular, each EB consisted of 80-120 LQs with a population of about 600. The EBs were selected based on the population of gazetted and built-up areas. The calculated target sample size was 34,539 respondents, and the overall response rate was about 99.30% (34,305 respondents). 3.2

Variables

The dependent variable of the present study is a categorical variable with a binary outcome indicating whether the respondents consumed alcohol in the past 30 days prior to the survey. Whilethe independent variables of the present study consist of age, income, gender, ethnicity, education, marital status, location of residence and employment status. 2


Table 1 Descriptive analysis of variables Alcohol drinker (Y = 1) Variables Age Income Gender Male Female Ethnicity Malay Chinese Indian/others Education Tertiary Secondary Primary Marital status Married Widowed/divorced Single Location of residence Urban Rural Employment status Civil servant Private sector Self-employed Student Unemployed

36.97 [12.73] 3421.86 [3705.40]

Non-alcohol drinker (Y = 0) Mean/%* 42.33 [15.77] 1900.10 [2602.63]

42.11 [15.69] 1963.05 [2674.48]

6.89 1.94

93.11 98.06

44.39 55.61

0.43 11.73 6.23

99.57 88.27 93.77

56.51 21.56 21.93

9.53 4.76 1.82

90.47 95.24 98.18

10.32 51.69 37.99

3.80 1.11 6.44

96.20 98.89 93.56

71.32 7.83 20.85

5.53 2.09

94.47 97.91

59.42 40.58

3.02 6.52 5.30 8.11 1.72

96.98 93.48 94.70 91.89 98.28

9.93 28.82 19.59 3.18 38.48

Total sample

Note: *For age and income variables, the value refers to mean [standard deviation], whereas for the other variables, the value refers to percentage.

Only age (in years) and income [in Malaysian Ringgit (RM)] are included as continuous variables to allow for linear relationships whereas the rest are formatted as categorical variables. Gender is divided into male and female while ethnicity is collapsed to Malay, Chinese and Indian/others. Education is segmented into three levels: tertiary, secondary and primary. Marital status is grouped into three categories: married, widowed/divorced and single while location of residence is categorised into two groups: urban (≥10000 populations) and rural (