An Econometric Analysis of Motorcycle Demand in Sarawak, Malaysia

Authors

  • Nur Zaimah Ubaidillah Universiti Malaysia Sarawak

Keywords:

motorcycle ownership, vector error correction model, fuel price, gross domestic product

Abstract

Motorcycles are considered a primary mode of transport in developing countries due to their affordability and lack of public transport infrastructure. Nonetheless, it is unclear whether this demand will be declining or increasing in the future due to increases in income or changes in fuel prices. Hence, this study uses vector error correction model to analyse the relationship between socio-economic variables and motorcycle ownership in Sarawak, Malaysia, using annual time series data for the 1980-2015 period. The results suggest that long-run income and price elasticity for motorcycle ownership are estimated to be 0.81 and -0.66. The study reveals that both income and fuel price are inelastic for motorcycle ownership in the long-run and that motorcycle is considered as a necessity good in Sarawak. These results provide useful insight for government to construct effective policies related to motorcycle demand.

References

Abuhamoud, M. A. A., Rahmat, R. A. O. K., & Ismail, A. (2011). Transportation and its concerns in Africa: A review. Social Sciences, 6(1), 51–63. http://doi.org/10.3923/sscience.2011.51.63

Bradburn, P., & Hyman, G. (2002). An Econometric Investigation of Car Use in the National Transport Model for Great Britain. Retrieved from http://abstracts.aetransport.org/paper/index/id/1354/confid/8

Brandt, P. T., & Williams, J. T. (2006). Multiple Time Series Models. SAGE Publications.

Clark, S. D. (2007). Estimating Local Car Ownership Models. Journal of Transport Geography, 15(3), 184–197. http://doi.org/https://doi.org/10.1016/j.jtrangeo.2006.02.014

Dargay, J. (2010). The prospects for longer distance domestic coach, rail, air and car travel in Britain. Report to the independent transport.

Dargay, J., Gately, D., & Sommer, M. (2007). Vehicle ownership and income growth, worldwide: 1960-2030. Energy Journal, 28(4), 143–170. http://doi.org/10.2307/41323125

Dargay, J. M. (2002). Determinants of car ownership in rural and urban areas: A pseudo-panel analysis. Transportation Research Part E: Logistics and Transportation Review, 38(5), 351–366. http://doi.org/10.1016/S1366-5545(01)00019-9

de Jong, G., Fox, J., Daly, A., Pieters, M., & Smit, R. (2004). Comparison of car ownership models. Transport Reviews, 24(4), 379–408. http://doi.org/10.1080/0144164032000138733

de Jong, G., Pieters, M., Daly, A. J., & Smit, R. (2004). A Comparison of Car Ownership Models. Transport Reviews, 24(4), 397–408.

Department of Statistics Malaysia. (2015). Sarawak Yearly Book of Statistics.

Dickey, D. A., & Fuller, W. A. (1979). Distribution of the estimators for autoregressive time series with a unit root. Journal of Th American Statistical Association, 74(366), 427–431. http://doi.org/10.2307/2286348

Duffy, M., & Robinson, T. (2004). An econometric analysis of motorcycle ownership in the UK. International Journal of Transport Management, 2(3–4), 111–121. http://doi.org/10.1016/j.ijtm.2005.04.002

Espey, M. (1997). Traffic Jam: An International Study of Automobile Travel Demand. Papers in Regional Science: The Journal of the RSAI, 76(3), 343–356.

Fearnley, N., & Bekken, J.-T. (2005). Long-term Demand Effects in Public Transport. In The Association for European Transport Conference. Strasbourg, France. Retrieved from http://abstracts.aetransport.org/paper/download/id/2144

Gujarati, D. N. (2004). Basic Econometrics. New York (Fourth). McGraw-Hill.

Hsu, T. P., Mohd. Sadullah, A. F., & Nguyen, X. D. (2003). A comparative study on motorcycle traffic development of Taiwan, Malaysia and Vietnam. The Eastern Asia Society for Transportation Studies (EASTS). Retrieved from http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.460.2229&rep=rep1&type=pdf

Jamson, S., & Chorlton, K. (2009). The changing nature of motorcycling: Patterns of use and rider characteristics. Transportation Research Part F: Traffic Psychology and Behaviour, 12(4), 335–346. http://doi.org/10.1016/j.trf.2009.04.002

Johansen, S., & Juselius, K. (1990). Maximum likelihood estimation and inference on cointegration- with applications to the demand for money. Oxford Bulletin of Economics and Statistics, 52(2), 169–210. http://doi.org/10.1111/j.1468-0084.1990.mp52002003.x

Law, T. H., Hamid, H., & Goh, C. N. (2015). The motorcycle to passenger car ownership ratio and economic growth: A cross-country analysis. Journal of Transport Geography, 46, 122–128. http://doi.org/10.1016/j.jtrangeo.2015.06.007

Lutkepohl, H., Saikkonen, P., & Trenkler, C. (2001). Maximum Eigenvalue Versus Trace Tests for the Cointegrating Rank of a VAR Process. Econometrics Journal, 4(2), 1–8. Retrieved from http://edoc.hu-berlin.de/series/sfb-373-papers/2000-83/PDF/83.pdf

Pongthanaisawan, J., & Sorapipatana, C. (2010). Relationship between level of economic development and motorcycle and car ownerships and their impacts on fuel consumption and greenhouse gas emission in Thailand. Renewable and Sustainable Energy Reviews, 14(9), 2966–2975. http://doi.org/10.1016/j.rser.2010.07.034

Prevedouros, P. D., & An, P. (1998). Automobile ownership in Asian countries: Historical trends and forecasts. ITE Journal (Institute of Transportation Engineers), 68(4), 24–29. http://doi.org/10.1504/IJGENVI.2002.002406

Rasagam, G. (1999). A “ Step ” Towards Sustainable Transport : A Case Study of Penang, Malaysia. Transport and Communications Bulletin for Asia and the Pacific (Vol. 68). Retrieved from http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.585.7073&rep=rep1&type=pdf

Reza, A., & Spiro, M. (1979). The demand for passenger car transport services and for gasoline. Journal of Transport Economics and Policy, 13(3), 304–319. Retrieved from http://www.jstor.org/stable/10.2307/20052550

Riley, K. (2002). Motor Vehicles in China : The Impact of Demographic and Economic Changes. Population and Environment, 23(5), 479–494. http://doi.org/10.1023/A:1015138118757

Romilly, P., Song, H., & Liu, X. (1998). Modelling And Forecasting Car Ownership In Britain. A Cointegration And General To Specific Approach. Journal of Transport Economics and Policy, 32(2), 165–185. Retrieved from http://www.bath.ac.uk/e-journals/jtep/pdf/Volume_32_Part_2_165-185.pdf

Sohail, M., Maunder, D. A. C., & Cavill, S. (2006). Effective regulation for sustainable public transport in developing countries. Transport Policy, 13(3), 177–190. http://doi.org/10.1016/j.tranpol.2005.11.004

Sperling, D., & Salon, D. (2002). Transportation in Developing Countries. Bulletin of the World Health Organization. Retrieved from https://www.c2es.org/docUploads/transportation_overview.pdf

Stock, J. H., & Watson, M. W. (2007). Erratum to “Why Has U.S. Inflation Become Harder to Forecast?” Banking, 39(1), 3–33. http://doi.org/10.3386/w12324

Tseu, L. (2006). Urban Transport Growth: The Challenges Ahead- The New Realism and Institutional Changes. In Fourth Sabah-Sarawak Environmental Convention 2006 (pp. 1–23). Retrieved from http://ww2.sabah.gov.my/jpas/news/Conv06/Papers/Pap8_SPU.pdf

Ubaidillah, N. Z. (2013a). An Econometric Analysis of Road Transport Demand in Malaysia. International Journal of Business Tourism and Applied Sciences, 1(1), 65–73.

Ubaidillah, N. Z. (2013b). Causality Analysis Among Tourist Arrival , Economic Development and CO2 Emission : the Case of Malaysia. In The International Conference on Tourism, Transport and Logistics 2013 (ICTTL2013). Paris.

Van-Dender, K., & Clever, M. (2013). Recent Trends in Car Usage in Advanced Economies – Slower Growth Ahead? OECD International Transport Forum. Discussion Paper. Paris.

Witt, S. F., & Johnson, R. (1986). An Econometric Model of New-car Demand in the UK. Managerial and Decision Economics, 7(1), 19–23. http://doi.org/10.1002/mde.4090070105

Downloads

Published

2021-05-02