Sains Malaysiana 53(4)(2024): 969-982

http://doi.org/10.17576/jsm-2024-5304-18

Latent Hidden Factor Model for Malaysia Consumer Price Index

(Model Faktor Pendam bagi Indeks Harga Pengguna Malaysia)

NURULKAMAL MASSERAN^1,2,*, SITI NORSALSABILA AHMAD FAROUK¹, R. NUR-FIRYAL^1,2 & MAHAYAUDIN M. MANSOR³

¹Department of Mathematical Sciences, Faculty of Science and Technology, Universiti Kebangsaan Malaysia, 43600 UKM Bangi, Selangor, Malaysia

²Center for Modelling and Data Analysis (DELTA), Faculty of Science and Technology,

Universiti Kebangsaan Malaysia, 43600 UKM Bangi, Selangor, Malaysia

 ³School of Mathematical Sciences, College of Computing, Informatics & Mathematics, Universiti Teknologi MARA, 40450 Shah Alam, Selangor, Malaysia

Diserahkan: 10 Oktober 2023/Diterima: 1 Mac 2024

Abstract

The consumer price index (CPI) is one of the significant indicators that can be used to track the inflation rate of a country and assess changes in the cost of living. Generally, the CPI measures the change in the average price of goods and services used by households. The increase in inflation can have a negative socioeconomic effects and the changes in the CPI value needs to be monitored to ensure that the country does not experience a serious inflation rate. In this work, exploratory factor analysis (EFA) was employed to interpret the importance of each variable in the CPI and determine how the latent factors influence the CPI structure in Malaysia for the period of 2003–2022. The findings showed that there are two main latent factors that can be formed. Factor 1 can be classified as ‘Household Expenditures and Lifestyle Choices’ and consists of six variables, namely, ‘alcoholic beverages and tobacco’, ‘housing, water, electricity, gas, and other fuels’, ‘decoration, hardware, and household maintenance’, ‘health’, ‘recreational and cultural services’, and ‘education’. In contrast, Factor 2 can be classified as ‘Daily Necessities and Lifestyle Convenience’ which consists of six variables, namely, ‘food and non-alcoholic beverages’, ‘clothing and shoes’, ‘transportation’, ‘communication’, ‘restaurants and hotels’, and ‘various goods and services’.  In addition, the results of our analysis showed that Factor 1 is more dominant in influencing the CPI structure in Malaysia.

Keywords: Factor analysis; latent structure; statistical model description

Abstrak

Indeks harga pengguna (IHP) adalah salah satu petunjuk penting yang boleh digunakan untuk mengesan kadar inflasi sesebuah negara dan juga untuk menilai perubahan dalam kos sara hidup. Secara amnya, IHP mengukur perubahan dalam harga purata barangan dan perkhidmatan yang digunakan oleh isi rumah. Kenaikan inflasi boleh mendatangkan kesan sosioekonomi yang negatif dan perubahan nilai IHP perlu dipantau bagi memastikan negara tidak mengalami kadar inflasi yang serius. Dalam kajian ini, analisis faktor terokaan (AFT) digunakan untuk mentafsir kepentingan setiap pemboleh ubah dalam IHP dan menentukan bagaimana faktor pendam mempengaruhi struktur IHP di Malaysia untuk tempoh 2003–2022. Keputusan kajian menunjukkan terdapat dua faktor pendam utama yang boleh dibentuk. Faktor 1 boleh dikelaskan sebagai ‘Perbelanjaan Isi Rumah dan Pilihan Gaya Hidup’ dan terdiri daripada enam pemboleh ubah, iaitu, ‘minuman beralkohol dan tembakau’, ‘perumahan, air, elektrik, gas dan bahan api lain’, ‘perkakasan, hiasan dan penyelenggaraan isi rumah’, ‘kesihatan’, ‘perkhidmatan rekreasi dan kebudayaan’ dan ‘pendidikan’. Sebaliknya, Faktor 2 boleh dikelaskan sebagai ‘Keperluan Harian dan Kemudahan Gaya Hidup’ yang terdiri daripada enam  pemboleh ubah, iaitu ‘makanan dan minuman bukan alkohol’, ‘pakaian dan kasut’, ‘pengangkutan’, ‘komunikasi’, ‘restoran dan hotel’ serta ‘barangan dan perkhidmatan lain’. Di samping itu, hasil analisis kami menunjukkan Faktor 1 lebih dominan dalam mempengaruhi struktur IHP di Malaysia.

Kata kunci: Analisis faktor; huraian model berstatistik; struktur pendam

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*Pengarang untuk surat-menyurat; email: kamalmsn@ukm.edu.my