Page 398 - Contributed Paper Session (CPS) - Volume 7

CPS2141 Lim Kok-Hwa et al.

Factors influencing the economic growth using
state gross domestic product (GDP): A case
study of Negeri Sembilan
Lim Kok-Hwa, Kon Mee-Hwa, Yaacob Hartini
Department of Statistics Malaysia

Abstract
The purpose of this article is to study the factors influencing the economic
growth of Negeri Sembilan. The data used in this paper focuses on regional
economic growth rate of GDP, particularly in the state of Negeri Sembilan. The
growth of twelve year’s time series data from Gross Domestics Product (GDP)
by State from year 2005 to 2017 were employed in this study. This paper
demonstrates the regression and correlation qualitative analysis of statistics
data obtaining from the Department of Statistics Malaysia using an E-Views
Program. In the first phase of the study, regression analysis has been used to
construct appropriate model as well as to determine the correlation among
Negeri Sembilan’s GDP and the main economic indicators, namely agriculture,
mining and quarrying, manufacturing, construction, services and import
duties. Least Square Method analysis was applied to identify the significance
of relationships among the economic indicators. Then, the second phase
analysis focuses on the selected significant variables with other related
economic indicators which consist of the consumer price index,
unemployment rate and interest rate. The empirical result shows
manufacturing and services are remaining as significant factors that
influencing the growth of GDP in Negeri Sembilan. Besides, three linear
econometric models were generated which indicate the correlation among
economic indicators. This paper is initiated by the statisticians in the
Department of Statistics Malaysia and to be served as a guideline to junior
statisticians as well as the junior analyst on implement statistical analysis using
time series of GDP data at regional level particularly at state level.

Keywords
Manufacturing; service; unemployment; CPI; correlation analysis.

1. Introduction
Negeri Sembilan is one of Malaysia's states located at 2°45′N 102°15′E
coordinates on the western coast of Peninsular Malaysia. It covers 6,665 square
kilometres land area of Malaysia with seven (7) districts namely Seremban, Port
Dickson, Jempol, Jelebu, Kuala Pilah, Rembau and Tampin. The population in
Negeri Sembilan is 1.128 million which is equal to 3.5% of total population in
Malaysia in year 2017. The Gross Domestics Product (GDP) per capita for
Negeri Sembilan is RM 39,763 in year 2017. Furthermore, the economic growth
385 | I S I W S C 2 0 1 9