Demand for Indonesian Patchouli Oil Exports: the Panel Autoregressive Distributed Lag (Ardl) Approach

Abstract

Purpose: This study aims to analyze the demand for oil exports and determine the short-term and long-term impact of patchouli oil price variables, per capita income of patchouli oil export destinations, and the real exchange rate on Indonesia's patchouli oil export demand. Theoretical framework: is supported by literature on demand of patchouli oil export Method/design/approach: This study employed panel ARDL regression (Autoregressive Distributed Lag) on data from 2006 - 2021 Results and conclusion: All variables significantly adversely affected the export demand over the long term but not the short term. Research implications: The Indonesian government is advised to carry out more intensive policies on the patchouli oil price variable to increase demand for patchouli oil exports in various countries so that the gap between world prices and export prices can be adjusted. It is also recommended that the central or regional government be able to establish various cooperations between countries so that world patchouli oil prices could remain stable, with the hope of increasing state revenues and demand for Indonesian patchouli oil exports. Originality/value: Indonesia is a country whose economy is supported by the export sector of agricultural commodities, one of which is patchouli oil exports. Because this sector greatly contributes to the national economy, it is important to analyze the determinants of demand for patchouli oil exports.