The Contribution of Economic Sectors to Economic Growth: The Cases of Malaysia and China

Malaysia and China have recently achieved spectacular economic growth where GDP per capita growth rapidly in both countries. Thus, this study examines the contribution of economic sectors to economic growth in Malaysia and China by using time series data from year 1978 until 2007. There are three economic sectors that will be analyzed, which are agricultural sector, manufacturing sector and service sector. Augmented Dickey Fuller (ADF) unit root test is used in this study and it showed that the time series data are stationary at the first differences. Then, correlation analysis indicated that agriculture sector, manufacturing sector and service sector had positive relationship with GDP per capita in Malaysia and China. In addition, results of model multiple regressions showed that services sector generated the highest contribution to Malaysia’s economic growth while manufacturing sector provided the biggest contribution to China’s economic growth.