Md. Mahmudul Alam

Integration of the national economy with global economy is the natural outcome and the end result of economic development processes in any nation. In the political economy of the world with unequal nations and imperfect competition the north-pushed capitalist globalization is a suspect of deception for developing countries. The capitalist globalization is a project of market dogmatism founded on the Darwinist social philosophy of ‘survival of the fittest’ – the law of Jangle. It is inherently a scheme of yielding disproportionately large benefits for the efficient industrialized nations. This paper analyses the structure and management of Malaysia’s economic globalization and studies its achievements from national and international contexts. It has used a variety of econometric and statistical tools such as the augmented Dickey-Fuller test, Log-linear Regressions, Chow breakpoint test, and CUSUM test. The results reveal that globalization has made significant achievements in terms of most of the national macroeconomic goals. However, in terms of the international political economy it has failed unexpectedly. Results of the income convergence analyses show that it has failed to reduce Malaysia’s income gaps with USA and Japan, its two major trading and investment partners. It contradicts the general findings of the income convergence studies that the lower income industrializing countries are catching up to the higher income industrialized countries and slowly narrowing the income gap between them. This result, therefore, tends to suggest that even a guided and regulated globalization, like that of Malaysia, will have the tendency to yield relatively more benefits to the developed industrialized economic partners and contributes to the widening of the income gaps between them. The paper concludes that because of the blind eye of globalization to the needs and aspirations of the developing economies, these countries must pursue globalization only, cautiously, rationally, selectively, and never wholeheartedly.

Capitalist globalization is the economic policy of integration of national economies with global economy on the basis of free market competition. It is a neoliberal prescription for industrialization and growth of the emerging economies of the South and a project of capital accumulation for the capitalist North through a process of securing disproportionate share of benefits at the expense of the developing South. Operating in this milieu of deceptive game of capitalist globalization Malaysia’s cautious and Malaysia-centric globalization approach has been found very successful at the national front, but at the international front it seriously failed to reduce Malaysia’s income gaps with its rich trade and growth partners. This therefore reconfirms the strength of deceptive nature of the capitalist globalization. The content analysis and Malaysia’s globalization experience poise to support the hypothesis that globalization has high potential to contribute to industrialization and growth of the emerging economies, but at the same time, being pursued under free market competition it has turned out to be a deceptive game of the North and cannot be trusted wholeheartedly for emancipation of the developing economies. The paper suggests for a policy of target oriented ‘inclusive globalization’, with the underlying theme of internationalization of the economies instead of globalization of trade and the perspective of ‘fair market’ instead of ‘free market’, to ensure equitable share of benefits of specialization and globalization among the participating nations.

Key words: Economic Globalization; Capitalist Globalization; Neoliberalism; Fair market; Economic Nationalism; Income Convergence; Industrial Competitiveness.

JEL Classification: C32, F13, F43, O11, O19, O47, O57, P16, P17

Despite a bourgeoning literature on the existence of a long-run relationship between energy consumption and economic growth, the findings have failed to establish clearly the direction of causation. A growing economy needs more energy, which is exacerbated by growing population. Evidence suggests that financial development can reduce overall energy consumption by achieving energy efficiency. Economic growth and energy consumption in Malaysia have been rising in tandem over the past several years.