ABSTRACT
The electronics industry in Malaysia has developed rapidly owing to the export-oriented trade policies adopted by the government of Malaysia since its independence in 1957. While production in the electronics industry has grown quickly, it has been closely followed by the boom and bust of external demand, with similar consequences for the industry's value added, employment and productivity. The authors discuss the trends of production in the electronics industry, the composition of output, the productivity of workers and the industry's trade competitiveness. This pattern of productivity may simply be due to the cycle of external demand for Malaysia's electronics industry; it is also possibly due to the industry not making significant investments to improve the industry's technological capabilities. Malaysia has been an open economy since its independence, except during two stints when Malaysia promoted an import substitution policy in the late 1960s and early 1980s. Malaysia's export-oriented economy facilitates trade relatively well.
