An Econometric Analysis of Food Security Determinants in Malaysia: A Vector Error Correction Model Approach (VECM)

  •  Noor Thoyibbah Abdul Wahab    
  •  Shri-Dewi Applanaidu    
  •  Nor’Aznin Abu Bakar    


Food security issue is getting more attention by world today. Although, Malaysia is a middle income country able to produce her own food, but there is still lack of food supply for domestic needs. This paper thus analyse the factors that affect the food security model in Malaysia during the period of 1982-2011. The analysis in this paper include food production index as food security proxy while the other variables include food prices, Malaysian population, foreign workers and CO2 emission as important determinants of food security. The assessment of the impact of these factors is achieved using the Vector Error Correction Model approach (VECM). The series on the food prices, Malaysian population, foreign workers, CO2 emission and palm-based biodiesel production are co-integrated. While in the short run only foreign worker is an important determinant of food security. Hence, the results of error correction term (Ect) from VECM shows that there is a long run causality between dependent variables and explanatory variables. This model is useful quantitative tool to assess food security especially to determine specific variables that explain the highest effect to food security at the national level.

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