Judhiana Abd Ghani

This study examines subnational debt sustainability in Malaysia under fiscal centralization, using panel data for thirteen states from 2004 to 2023. Although Malaysia is constitutionally federal, fiscal authority is highly centralized, leaving state governments with limited revenue autonomy and strong dependence on federal transfers. Political alignment between state and federal governments is included as a key institutional factor influencing access to transfers and borrowing approvals. A panel autoregressive distributed lag (ARDL) model estimated using the Pooled Mean Group (PMG) approach captures heterogeneous short-run dynamics while imposing a common long-run equilibrium relationship. Robustness checks using the Augmented Mean Group (AMG) estimator indicate that state debt is negatively affected by federal transfers and economic growth in the long run, while short-run debt dynamics respond mainly to economic growth shocks. The contributions of own-source revenue, expenditure pressures, and political alignment are not statistically robust and cannot be conclusively established. Less fiscally capable states, such as Perlis, Kedah, Kelantan, Terengganu, Sabah, and Sarawak, converge more slowly toward long-run equilibrium, reflecting institutional constraints and reliance on federal support. These findings highlight the macroeconomic and institutional implications of fiscal centralization, intergovernmental coordination, and state-specific fiscal capacity, providing policy-relevant insights for enhancing fiscal discipline in Malaysia’s quasi-federal system.

The environmental impact of government size is a complex issue, yet the pollutant-specific effects and the role of institutional factors remain underexplored. This study examines the impact of local government size on sulphur dioxide (SO ₂ ) emissions and industrial wastewater discharge in Chinese prefecture-level cities, and the moderating role of fiscal transparency. The results reveal that larger local government size increases SO ₂ emissions but reduces wastewater discharge. However, both effects are weakened by fiscal transparency. The findings suggest that local governments may strategically compromise on regulating SO ₂ emissions to cope with intensified fiscal pressure from government expansion, while allocating increased governance resources to wastewater treatment to pursue political performance. This implies that policymakers should closely monitor such strategic shifts and prioritise establishing fiscal transparency to limit speculative behaviour and ensure that enhanced governance capacity ultimately serves the broader public interest.

Fiscal transparency strengthens accountability mechanisms through mitigating information asym­metry, probably moderating the effect of fiscal de­centralization on local government size. Using data from 283 Chinese prefecture-level cities, this study tests the hypothesis with the Generalized Method of Moments (GMM) estimator. We find that fiscal de­centralization expands local government size under low transparency, but this positive effect weakens as transparency improves and becomes insignifi­cant beyond a threshold. Vertical balance, reflecting reliance on own-source revenue, initially increases government size, but this effect diminishes with higher fiscal transparency and turns negative at higher transparency levels. These findings reveal that the common-pool hypothesis holds condition­ally, suggesting that fiscal transparency is critical to ensure that fiscal decentralization promotes effi­cient public resource allocation.

This study investigates how fiscal transparency moderates the relationship between local government size and the composition of public expenditure in Chinese prefecture-level cities. Using panel data from 283 cities between 2013 and 2022, the study employs a two-way fixed effects dynamic panel model estimated with the system GMM approach to address endogeneity and dynamic behavior. The results show that an increase in local government size is initially associated with a rise in productive expenditures, such as science and technology, and a decline in unproductive expenditures, including education, social security, and health care. However, fiscal transparency significantly moderates these effects. As transparency increases, the positive impact of government size on productive spending weakens, while the negative impact on unproductive spending also diminishes. These findings suggest that fiscal transparency plays a critical role in shaping how local governments allocate resources under fiscal pressure, by reducing information asymmetry and enhancing accountability. The study concludes that while larger governments may prioritize economic functions over social services, transparency can constrain such tendencies. Policymakers should therefore closely monitor government expansion and improve transparency mechanisms to ensure a balanced approach that supports both fiscal sustainability and public welfare.

Residents’ consumption is a good indicator of people’s livelihoods and one of the motivations driving economic growth. There are many studies on the influencing factors of residents’ consumption; however, few have studied the effects of industrial agglomeration on residents’ consumption, and even fewer have studied the spatial correlation of residents’ consumption. The goal of this paper is to research the impact of China’s manufacturing industrial agglomeration on residents’ consumption from a spatial perspective. Using data on China’s 31 provinces from 2003 to 2019 and the spatial Durbin model, our results show that the manufacturing industrial agglomeration and residents’ consumption present an inverted “U-shape” relationship and that different regions show different effects. Industrial agglomeration in the eastern region is relatively high and has a restraining effect on residents’ consumption, while industrial agglomeration in the central and western regions is at an early stage and promotes residents’ consumption. Therefore, different regions should adopt different industrial agglomeration policies.

Developing countries have witnessed economic growth as their GDP keeps increasing steadily over the years. The growth led to higher energy consumption which eventually leads to increase in air pollutions that pose a danger to human health. People’s healthcare demand, in turn, increase due to the changes in the socioeconomic life and improvement in the health technology. This study is an attempt to investigate the impact of environmental quality on per capital health expenditure in 125 developing countries within a panel cointegration framework from 1995 to 2012. We found out that a long-run relationship exists between per capita health expenditure and all explanatory variables as they were panel cointegrated. The explanatory variables were found to be statistically significant in explaining the per capita health expenditure. The result further revealed that CO2 has the highest explanatory power on the per capita health expenditure. The impact of the explanatory power of the variables is greater in the long-run compared to the short-run. Based on this result, we conclude that environmental quality is a powerful determinant of health expenditure in developing countries. Therefore, developing countries should as a matter of health care policy give provision of healthy air a priority via effective policy implementation on environmental management and control measures to lessen the pressure on health care expenditure. Moreover more environmental proxies with alternative methods should be considered in the future research.