Abstract
Government expenditure plays an important role in the country’s economic growth. Budget allocations through the annual budget presented have their strategies to ensure that the allocated budget can improve the growth and development in Malaysia and also can be enjoyed by all Malaysian. The government’s expenditure has contributed to the expansion of this country’s development from various sectors. However, there are various problems involving government expenditure such as low level of health, homeless poor people, weak public transportation and illegal immigrants. The purpose of this study is to examine the relationship between government expenditure on health, education, housing, transportation and defence sectors towards economic growth. The data used is secondary data from 1980-2017 for 38 years from the Department of Statistics, Malaysia and World Bank Data. The method used in this study is Descriptive Analysis and Autoregressive Distributed Lagged Model (ARDL). The result showed that economic growth and government expenditure on health, education, transportation, and defence has a long-run relationship. Therefore, the government should increase more expenditure on crucial sectors such as education, transportation, defence and health that will strengthen economic growth in the long run.
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