Real GDP Growth Rates of the Asean Region: Evidence of Spillovers and Asymmetric Volatility Effects

Abstract

This paper identifies economic relations using real gross domestic product (GDP) within the five Associations of South-east Asian Nation economies namely: Indonesia, Malaysia, Philippines, Singapore and Thailand. Utilizing ARMA-GARCH, ARMA-EGARCH, ARMA-APARCH models, the study captures the presence of the leverage effect, and spillover of returns and volatility. Most economies except for Singapore are consistent with leverage effects, while the Philippines showed economic resilience with having symmetric volatility response. On one hand, Thailand’s economy has consistent negative one-way relationship on Malaysia’s economy for the three models. This paper suggests that ASEAN economies work together to improve bilateral relations and market integration by trading and investing; and cooperation in terms of food production and migrant workers condition. This will help to reinforce their economic and political relationships that can help boost their respective economies, and sense of regionalism. ASEAN should help each other by sharing their ways to improve the standards of living of their citizens, promotion of safer security and anti-terrorism activities, provide a safer place for the national and overseas workers, trade goods and sell in competitive prices, improve the level of education inside the country. Future studies can further extend data to include other ASEAN countries and also consider other political and economic organizations. A perceived limitation of the paper is the uncertainty of these five ASEAN-5 economies impact within the other major countries but to also other regional groupings and specific economies. In general, this paper can help policy-makers and researchers alike in better understanding economic relations and spillover effects of growth rates and volatility of real GDP. The paper offers further examination of the potential for further connection among the major ASEAN economies and to support existing integration policies.

The Impact of COVID-19 on the Connectedness of Stock Index in ASEAN+3 Economies

“…The APT block comprises ten ASEAN member states and three East Asian countries (China, Japan, and South Korea). ASEAN is considered to be the strongest and most successful regional grouping in the developing world, and its strong economic performance has made ASEAN one of the most active regions in the world [38]. Among ASEAN countries, we include the top five ASEAN countries, namely Indonesia, Malaysia, the Philippines, Singapore, and Thailand (ASEAN-5), as well as Vietnam.…”