GALLEY PROOF 1 Jurnal Ekonomi Malaysia 54(2) 2020 http://dx.doi.org/10.17576/JEM-2020-5402-06 Factor Accumulation and Total Factor Productivity Growth: ASEAN Economies (Pengumpulan Faktor dan Jumlah Faktor Pertumbuhan Produktiviti: Ekonomi ASEAN) Subramaniam Munusamy Manipal International University Yogambigai Rajamoorthy Tunku Abdul Rahman University ABSTRACT This study examines the contribution of factor accumulation on Total Factor Productivity (TFP) growth in the eight ASEAN countries with specific reference to short-term and long-term estimation effect. Using Mean Group (MG) estimator on data between 1990 and 2018, this study found a significant relationship between capital accumulation and TFP growth. Our analysis suggests that the positive growth on TFP in most ASEAN countries was due to the short-run effect of capital accumulation. This study also found that the ASEAN economies have a relatively lower rate of capital utilization that adversely affects TFP growth in the long run. The contribution of TFP to output growth is paramount for the sustainability of long-term economic growth. Thus, ASEAN countries need to accelerate capital accumulation and technology adoption in the short-term and utilize idle capital in the long-term. Keywords: Factor accumulation; TFP; Mean Group Estimator; ASEAN ABSTRAK Kajian ini bertujuan untuk mengkaji sumbangan pengumpulan faktor keatas pertumbuhan Produktiviti Faktor Keseluruhan (TFP) di lapan negara ASEAN dengan merujuk secera khusus kesan terhadap jangka pendek dan jangka panjang. Dengan menggunakan anggaran Mean Group (MG) ke atas data antara 1990 and 2018, selaras dengan beberapa hasil kajian yang lalu, kajian ini mendapati hubungan yang signifikan hanya diantara pengumpulan modal dan pertumbuhan TF. Butiran unik analisis kami menujukkan bahawa pertumbuhan positif TFP di kebayakkan negara ASEAN adalah disebabkan oleh kesan jangka pendek pengumpulan dana. Walau bagaimanapun, kajian ini juga mendapati bahawa ekonomi ASEAN mengalami kadar penggunaan modal yang lebih rendah yang mempengaruhi pertumbuhan TFP dalam jangka panjang. Sumbangan TFP terhadap pertumbuhan keluaran adalah amat penting bagi kelestarian pertumbuhan ekonomi jangka panjang. Oleh itu, penting bagi negara-negara ASEAN untuk mempercepatkan pengumpulan modal dan penggunaan teknologi dalam jangka pendek dan menggunakan secara optimum modal terbiar dalam jangka panjang. Kata kunci: Pengumpulan faktor pengeluaran; TFP; Mean Group Estimator; ASEAN INTRODUCTION The economic growth of some countries is faster than others despite there were no drastic differences in initial stock of capital or labour. This has been one of the primary concerns of economists around the world in recent decades and led to studying the underlying growth models of economic development. A considerable number of studies have reported that the accumulation of factors of production can only explain economic growth partially. A substantial part of contributing factors often remains dormant within the production development and technological processes known collectively as Total Factor Productivity (TFP). The TFP growth not only significantly contributes to the economic growth of many countries, but also explains the gap in productivity levels and income differences (Kim & Park 2018). TFP growth addresses contributing causes of economic growth by extensive measurements on related elements, such as the efficient distribution of resources, development of technological spill-over, human capital accumulation, population, currency, and research and development (R&D) as well as firm’s accessibility to finance (Kim & Park 2018; Sulaiman & Rashid 2013). Numerous studies that were devoted to addressing these developments cited the role of TFP growth in the economic growth differences across countries. This study, which is aimed at assessing the primary force of productivity, uses TFP with specific reference to inputs of the factor of production such as capital and labour between 1990 and 2018. The aggregate allocation of these variables within and between firms and industry potentially determine the level of productivity. Although it has been often reported that there