Fiscal policy in Malaysia boosts economy during growth recessions.
The study looked at how government spending affects the economy in Malaysia. They found that government spending has become more in line with economic growth over the past 25 years. When the government invests more money, the economy grows by a factor of 2.7 during slow economic times and by a factor of 2 during normal times. Investing in public projects is more effective than spending on consumption. Changing tax policies doesn't boost the economy as much as direct government spending. This shows that when the government spends money in sync with the economy, it helps the economy more in emerging markets like Malaysia.