The Determinants of Exports between Malaysia and the OIC Member Countries: A Gravity Model Approach

This paper investigates the impact of economic factors on bilateral exports between Malaysia and the OIC member countries. Using the panel estimation for gravity model, the data covers the period of 1997 to 2009. The gravity estimates imply the importance of size effects, level of openness of the economy, inflation rates, and the exchange rates as determinants of Malaysia's exports to OIC countries. The estimation of individual effects shows the significance of distance and institutions in enhancing Malaysia-OIC exports.