Malaysian Economics

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2 - CAUSES OF INEQUALITY OF INCOME DISTRIBUTION
2.1 Differences in education
During the British rule, each ethnic group also generally experienced different education systems. Most Malays were educated in the government school system located in the rural areas that used the Malay language as the medium of instruction. The Chinese on the other hand sent their children to the Chinese medium schools, which mere established by Chinese voluntary associations. Nevertheless , the elite segment of each ethnic group generally sent their children to the English medium schools located in the urban areas, where the quality of education was far better than the rural Malay-medium school. Furthermore, most secondary and tertiary education was available in the urban areas with English as the medium of instruction. Those who were educated at the English medium schools tended to gain positions in the civil service, commerce, business, and professions. Since most of the Malays were educated in the rural Malay medium schools, this indirectly limited their upward social mobility.

3.2 Differences in skills
Since Malay only received the education from government school in rural areas, the skills were limited. Lack of skills and knowledge were the factors of unemployed. This will worsened the situation of poverty and income disparities between the ethnic groups.

Sectoral employment of Bumiputera and non-Bumiputera (%) in peninsular Malaysia, 1970. Sector| Bumiputera| Non-Bumiputera|
Primary| 67.6| 32.4|
Secondary| 30.8| 69.2|
Tertiary| 37.9| 62.1|

Notes: Primary (agriculture)
Secondary (mining, manufacturing, construction, utilities, and transport) Tertiary (wholesale and retail trade, finance, government, and other services)

3.3 Differences in access to capital
A majority of non-malays are usually found to be living in the southern and western states of Malaysia , such as Pulau Penang and Kedah. These states form...
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