Wisdom of Malaysia’s Guided Economic Globalization in the Milieu of Today’s Capitalist Globalization

Abstract

Capitalist globalization is a project of market dogmatism founded on the Darwinist social philosophy of ‘survival of the fittest’. In the political economy of the world with unequal nations and imperfect competition, it is a suspect of deceptive game for the developing countries. This paper is an attempt to analyze the wisdom of Malaysia’s guided economic globalization strategy using the technique of log-linear pooled ordinary least square regression and related macroeconomic time series data for the period 1982-2016. The empirical results suggest that Malaysia’s guided globalization strategy has been found successful in achieving most of its national macroeconomic goals. But in terms of international economic competitiveness the success has been only modest, its per capita income ratios with its two most important trading and development partners - USA and Japan - are found decreasing steadily having a catching up phenomenon along the path of income convergence. However, its per capita income gaps with them in absolute term are found still large and widening to suggest that developing countries must pursue globalization very cautiously and selectively.