IESET.
Hypotheses·growth·sea_malaysia_1mdb_economic_effect_2015_2024

Malaysia's 1MDB scandal — public-fund misappropriation 2009-2015, international scandal exposure 2015-2018, Najib conviction 2020 — produced measurable institutional-quality damage observable in Worldwide Governance Indicators (WGI) Control of Corruption and Government Effectiveness scores, and an associated under-performance in real GDP-pc growth vs ASEAN-5 peer mean over 2015-2019.

WGI Control of Corruption percentile rank for MYS declines by at least 5 percentile points 2014 to 2018, and real GDP-pc growth differential MYS minus ASEAN-5 peer mean (IDN, PHL, THA, VNM) over 2015-2019 averages at least -0.5pp/yr.

PARTIALengine/runs/sea_malaysia_1mdb_economic_effect_2015_2024

PARTIAL — coef=-0.0341, p=0.93 (above α=0.1); direction inconclusive

confidence cueThe result is useful, but not decisive. Treat it as a clue, not a settled conclusion.

policy briefMixed or noisy

In ordinary language

Over a long period, do more market-oriented institutions translate into higher income or productivity, once the comparison looks beyond a single success story?

plain answer

The evidence is suggestive but not decisive. coef=-0.0341, p=0.93 (above α=0.1); direction inconclusive

why it matters

Growth claims can look convincing in single success stories. This test asks whether the pattern survives a broader comparison.

how the test works

It compares 5 country or place units from 2008 to 2024, using a panel fe design, with fixed effects for country and year.

what was measured
What changed
  • Post 1mdb exposure indicator
What we checked
  • Real income pc growth
  • Wgi control of corruption
  • Wgi government effectiveness
what this does not prove

A single test is not the whole truth. It narrows the claim under a specific sample, time period, and method. Strong policy conclusions need the pattern to survive nearby tests, alternative data, and serious objections.

verification

No evidence packet has been generated yet.

Results

engine/runs/sea_malaysia_1mdb_economic_effect_2015_2024
1007550250200820162024MYSIDNPHLTHAVNM
illustrative sketch · run pending
No coefficients yet. When the model fires, this chart will show real_gdp_pc_growth across 5 sampled countries over 2008–2024.
The shapes above are stylised — none of the lines are real data.
Placeholder for sea_malaysia_1mdb_economic_effect_2015_2024. Published chart will be generated from engine/runs/sea_malaysia_1mdb_economic_effect_2015_2024/chart_data.json.

Pre-registration

pre-registered
first-spec commit 098ce96 · 2026-04-30T12:57:33Z
run generated · 2026-06-29T17:53:01Z

Malaysia's 1MDB scandal — public-fund misappropriation 2009-2015, international scandal exposure 2015-2018, Najib conviction 2020 — produced measurable institutional-quality damage observable in Worldwide Governance Indicators (WGI) Control of Corruption and Government Effectiveness scores, and an associated under-performance in real GDP-pc growth vs ASEAN-5 peer mean over 2015-2019. WGI Control of Corruption percentile rank for MYS declines by at least 5 percentile points 2014 to 2018, and real GDP-pc growth differential MYS minus ASEAN-5 peer mean (IDN, PHL, THA, VNM) over 2015-2019 averages at least -0.5pp/yr.

Falsification criterion — what would disprove this

set before the run · honoured after

This hypothesis is considered falsified if:

PRIMARY (dispositive, BOTH for SUPPORTED): (1) WGI Control of Corruption percentile rank for MYS falls by at least 5 percentile points from 2014 to 2018; AND (2) MYS real GDP-pc growth minus ASEAN-5 peer mean (IDN, PHL, THA, VNM) over 2015-2019 averages at most -0.005 (MYS at least 0.5pp/yr below peers). REFUTED if EITHER fails.

formal test & threshold
test:      malaysia_1mdb_wgi_decline_growth_underperformance_2015_2019
threshold: PRIMARY 1: wgi_control_of_corruption_pct(MYS, 2018) - wgi_control_of_corruption_pct(MYS, 2014) <= -5. PRIMARY 2: gdp_pc_growth(MYS, 2015-2019 mean) - gdp_pc_growth(ASEAN5, 2015-2019 mean) <= -0.005. METHOD_VALID: WGI Control of Corruption available for MYS 2014, 2018; WDI NY.GDP.PCAP.KD.ZG for MYS and ASEAN-5 across 2015-2019.

Method

Template
panel_fe
Fixed effects
country, year
Clustering
country
Sample
5 countries · 2008 – 2024
Evidence type
associational

Two-way fixed effects panel with ASEAN-5 peer pool. WGI test is country-level pre-post; growth test is panel DiD.

Data

VariableSourceTransform
real_gdp_pc_growth
outcome
world_bank_wdi:NY.GDP.PCAP.KD.ZGtier 2
level
wgi_control_of_corruption
outcome
wgi:CC.PER.RNKtier 4
level
wgi_government_effectiveness
outcome
wgi:GE.PER.RNKtier 4
level
log_gdp_pc_ppp
outcome
world_bank_wdi:NY.GDP.PCAP.PP.KDtier 2
log
post_1mdb_exposure_indicator
treatment
constructed:indicator = 1 for MYS, year >= 2015tier 5
indicator
gross_capital_formation_pct_gdp
control
world_bank_wdi:NE.GDI.TOTL.ZStier 2
level

● ready  · ● pending  · ● reconstruct-needed

Detailed result card

Result card — sea_malaysia_1mdb_economic_effect_2015_2024

Verdict: PARTIAL — coef=-0.0341, p=0.93 (above α=0.1); direction inconclusive

Pre-registration

  • Claim: Malaysia's 1MDB scandal — public-fund misappropriation 2009-2015, international scandal exposure 2015-2018, Najib conviction 2020 — produced measurable institutional-quality damage observable in Worldwide Governance Indicators (WGI) Control of Corruption and Government Effectiveness scores, and an associated under-performance in real GDP-pc growth vs ASEAN-5 peer mean over 2015-2019. WGI Control of Corruption percentile rank for MYS declines by at least 5 percentile points 2014 to 2018, and real GDP-pc growth differential MYS minus ASEAN-5 peer mean (IDN, PHL, THA, VNM) over 2015-2019 averages at least -0.5pp/yr.
  • Falsification rule: PRIMARY (dispositive, BOTH for SUPPORTED): (1) WGI Control of Corruption percentile rank for MYS falls by at least 5 percentile points from 2014 to 2018; AND (2) MYS real GDP-pc growth minus ASEAN-5 peer mean (IDN, PHL, THA, VNM) over 2015-2019 averages at most -0.005 (MYS at least 0.5pp/yr below peers). REFUTED if EITHER fails.
  • Falsification test: malaysia_1mdb_wgi_decline_growth_underperformance_2015_2019

Estimate

  • Method: linearmodels.PanelOLS
  • Coefficient (treatment): -0.0341
  • Std error: 0.3886
  • p-value: 0.93
  • Observations: 85, countries: 5
  • Within R²: 0.0778
  • Fixed effects: entity=True, time=True
  • Clustering: country

Variables resolved

  • world_bank_wdi:NY.GDP.PCAP.KD.ZG → real_gdp_pc_growth (outcome, publisher=world_bank_wdi, n=13897)
  • world_bank_wdi:NY.GDP.PCAP.PP.KD → log_gdp_pc_ppp (outcome, publisher=world_bank_wdi, n=8325)
  • constructed: indicator = 1 for MYS, year >= 2015 → post_1mdb_exposure_indicator (treatment, publisher=constructed, n=85)
  • world_bank_wdi:NE.GDI.TOTL.ZS → gross_capital_formation_pct_gdp (controls, publisher=world_bank_wdi, n=10428)

Variables missing data

  • world_bank_wgi:CC.PER.RNK (outcome, name=wgi_control_of_corruption) — vintage not on disk
  • world_bank_wgi:GE.PER.RNK (outcome, name=wgi_government_effectiveness) — vintage not on disk

Generated by scripts/run_panel_fe.py at 2026-06-29T17:53:01+00:00

Strongest opposing argument

Every hypothesis ships with its charitable opposing argument. The framework earns credibility by handling objections at their strongest, not weakest.

Notes

Tests institutional-quality damage via WGI and growth under-performance via panel-FE. The 2018 GE14 election (PH coalition victory unseating BN/Najib) is the political response to the scandal; the 2020 Najib guilty verdict is the legal capstone.

Authored framework. Read the transparency note.