Economic Growth In Indonesia Research Articles

Hubungan Jangka Pendek dan Jangka Panjang antara Pembiayaan Perbankan Syariah dan GDP di Indonesia dengan menggunakan metode Vector Error Correction Model

This research analyzes the relationship between Islamic bank financing and economic growth as measured by Gross Domestic Product (GDP) using the Vector Error Correction Model (VECM) to explain the short-term and long-term relationship dynamics between these two variables. The results of this research found that there is a long-term negative relationship between Islamic bank financing and GDP. These findings indicate that, although Sharia financing is expected to support economic growth through Sharia-based financial principles, the reality shows that the direct effect on overall economic growth is more complex and not always unidirectional. Apart from that, this research also finds that in the short term, both sharia financing and GDP adjust back to long-term balance after experiencing deviations, which means a strong economic correction mechanism exists. The stable VAR stability test results validate the model's reliability in describing the accurate relationship between sharia financing and economic growth in Indonesia. These findings provide important insights for policymakers and Islamic banking practitioners in developing more effective strategies to encourage inclusive economic growth.

Dampak Industri Halal pada Perekonomian di Indonesia: Pengaruh Pendapatan, Ekspor, dan FDI terhadap PDB Melalui Pendekatan GMM

This research explores the influence of income, exports and foreign direct investment (FDI) on Gross Domestic Product (GDP) in the halal industry in Indonesia, using the Generalized Method of Moments (GMM) approach. This study is based on panel data from companies operating in the halal sector between 2010 and 2022. The results show that income and exports positively and significantly influence GDP growth, confirming the importance of company activities and export performance in driving national economic growth. In contrast, FDI was found to have no significant effect on GDP, indicating that foreign investment's contribution in this sector is not yet optimal or is influenced by other factors such as the quality of institutions and infrastructure. This research provides important implications for policymakers and stakeholders, considering the urgency of improving export strategies, diversifying markets, and improving the quality of institutions and infrastructure to maximize the economic benefits of FDI. In addition, the results of this research also emphasize the important role of the halal industry as a major contributor to Indonesia's economic growth, as well as the need for policies that support further development and diversification of the halal industrial sector.

Econometric Model of Economic Growth in Indonesia Using the SYS and FD-GMM Approach

Econometric Model of Economic Growth in Indonesia Using the SYS and FD-GMM Approach

Indonesian economy under the shadow of catastrophic natural disasters: empirical evidences from additive mixed model with P-Spline smooth function

As located within the Ring of Fire with more than half of the volcanoes are active making Indonesia as one of the most vulnerable countries to natural disasters. Moreover, Indonesia was ranked 12th of 35 countries with the highest risk from natural disasters by the World Bank in 2021. Such multiple disasters could hamper the Indonesian economy through disaster loss. This study is conducted to investigate the impact of several natural disasters, including hydrological, meteorological, climatological, and geophysical, on Indonesian economic growth of 34 provinces in Indonesia from 2018 to 2022 represented by annual per capita real output growth. While the disaster damages are measured by the number of affected people and the number of damaged infrastructures. The econometric approach of panel data analysis is employed and further extended to the additive mixed model with P-spline smooth function to capture the non-linear relationship. The human development index (HDI) and financial realization of the unexpected budget are also incorporated in the models. The results show that the best model, the P-spline model, could capture the nature of the non-linear relationship between natural disasters and economic growth. In addition, the estimation process is also carried out separately for each group based on the HDI and financial ability. The variation of impact behaviour from natural disasters is clearly revealed by modelling each group based on HDI and financial ability indicating that each provincial group has a different impact transmitted by the natural disasters.

The Role of Political Stability and Foreign Direct Investment in Indonesia's Economic Growth

This study aims to determine how the role of political stability and foreign direct investment to economic growth in indonesia. This study also aims to examine the influence of political stability and foreign direct investment (FDI) in playing an important role in economic growth in 34 provinces in Indonesia for the period 2018-2022. The method used in this study is a quantitative research method using secondary data in the form of panel data. The analysis tool used is panel regression. It was found that the positive relationship between political stability, Foreign Direct Investment (FDI), has a very important role for economic growth in Indonesia.

Upaya Meningkatkan Minat Beli Omset Penjualan Melalui Sertifikasi Halal Di Kecamatan Tirtoyudo

Indonesia's economic growth is significantly assisted by micro, small, and medium enterprises (UMKM). However, many UMKM in the Tirtoyudo sub-district area are not aware of the importance of product certification. To make business owners aware of the importance of product certification, extensive socialization is needed. As a country with a majority Muslim population, halal certification has a significant impact on consumer interest in a product. This is the motivation behind our devotional research, which aims to educate consumers on the importance of halal certification for food or cosmetics. In addition, so that business owners are aware and understand that managing halal certification is simple and only requires KUA to achieve sub-district level management. The product must be able to compete in the market and broaden its reach in order to generate more revenue.

Fintech Peer-to-Peer Lending, E-Money and Indonesia's Economic Growth

Fintech Peer-to-Peer Lending, E-Money and Indonesia's Economic Growth

E-Commerce's Impact On Economic Growth

This study aims to analyze the impact of e-commerce on economic growth in Indonesia using a Systematic Literature Review (SLR) approach. E-commerce has become a significant global phenomenon, and Indonesia is projected to have the highest e-commerce growth rate in the world in 2024. With an e-commerce trade value reaching 78%, Indonesia shows great potential in this sector. The study finds that e-commerce contributes significantly to increased productivity and efficiency, broader market access, and technology and innovation adoption by SMEs. However, challenges such as technology access, digital literacy, and infrastructure remain obstacles. The study emphasizes the need for policies that support the enhancement of digital infrastructure and training for SMEs to optimize e-commerce potential. Relevant policy implications can help the government and stakeholders maximize the benefits of e-commerce for national economic growth. By using the SLR approach, this study provides a comprehensive and integrative analysis of the impact of e-commerce on economic growth in Indonesia and presents strong empirical evidence of the causal relationship between the two. The study also offers recommendations for future research, including the use of primary data, regional analysis, international comparative studies, and attention to social and environmental impacts. Additionally, further research into policy and regulatory effectiveness, the role of technology and innovation, longitudinal studies, and collaboration with the private sector is also recommended. Thus, this study makes an important contribution to understanding and leveraging e-commerce potential for sustainable economic growth in Indonesia.

Pengaruh Liberalisasi Arus Modal terhadap Pertumbuhan Ekonomi ASEAN-5

This study aims to examine the relationship between capital flow liberalization and economic growth in ASEAN-5. This research is a quantitative study that uses data: GDP, Gross Capital Formation, financial disclosure seen from the Chinn-Ito index for the period 2000-2017 in 5 ASEAN countries namely Indonesia, Malaysia, the Philippines, Singapore, and Thailand. Data were processed using panel data regression analysis and specifically for Indonesia, Partial Adjustment Model (PAM) regression was performed. The results of this study indicate that financial openness seen from the Chinn-Ito index has a negative and significant influence on the economic growth of ASEAN-5 countries. Capital flows have a positive and significant impact on the economic growth of ASEAN-5 countries. Meanwhile, the PAM (Partial Adjustment Model) regression model shows that capital flows have a positive and significant influence on Indonesia's economic growth both in the short and long term, while financial openness has a negative and significant impact on Indonesia's economic growth both in the short and long term.

Factors Affecting the Financial Performance of MSMES: Financial Literacy, Financial Inclusion, Financial Self-Efficacy, Financial Technology, Credit Granting, and Intellectual Capital

MSMEs are one of the economic icons that have the biggest impact on Indonesia's economic growth, especially when a crisis occurs. MSMEs are able to get through monetary crises such as in 1998 and during the Covid-19 pandemic. MSMEs are independent and have great potential to improve community welfare. This research aims to examine the influence of the variable’s financial literacy, financial inclusion, financial self-efficacy, financial technology, credit granting, and intellectual capital on the financial performance of MSMEs in the Bangka Belitung Islands Province. This research is quantitative research with an associative method using a quantitative approach from primary data through distributing questionnaires. The sampling method was nonprobability sampling with a purposive sampling technique so that 102 MSME actors were obtained. The data analysis technique uses SPSS version 26 software. The research results prove that partial financial inclusion (X2), financial technology (X4), credit granting (X5), and intellectual capital (X6) have a positive and significant effect on the financial performance of MSMEs, while financial literacy (X1) and financial self-efficacy (X3) do not have a positive and significant effect on the financial performance of MSMEs. Simultaneously, the variables financial literacy, financial inclusion, financial self-efficacy, financial technology, credit granting, and intellectual capital have a positive and significant effect on the financial performance of MSMEs in the Bangka Belitung Islands. The R Square value in this research is 0.885, so it is concluded that 88.5% of the variation in the dependent variable can be explained by the independent variable and the remaining 11.5% is influenced by other variables not examined in this research. It is hoped that the research results can become reference material and motivation for MSMEs in improving the financial performance of their businesses.

Effect of Inflation on Economic Growth in Indonesia: The Moderating Role of Electronic Money Transaction

Effect of Inflation on Economic Growth in Indonesia: The Moderating Role of Electronic Money Transaction

The Contribution of Fiscal Decentralization and Natural Resources on Economic Growth in Indonesia: Does Corruption Hamper?

Objective –This study aims to explain the effect of fiscal decentralization and natural resources on economic growth in Indonesia; and the moderating role of corruption in both fiscal decentralization-economic growth and natural resources-economic growth nexuses.Methodology –This study uses quantitative approach by utilizing a moderated panel data regression analysis with cross-sectional observations of 34 provinces in Indonesia from 2011 to 2021.Results –Fiscal decentralization has no significant effect on economic growth, while natural resources positively affect economic growth. Furthermore, we found no moderating effect of corruption in the fiscal decentralization-economic growth nexus, but the weakening effect of corruption is evident in the natural resources-economic growth nexus. Research limitation/implications – To further encourage economic growth in the regional level, it is vital to impose budget composition requirements on regional governments in the framework of fiscal decentralization, particularly related to employee and capital expenditure; and to maintain the decentralization of natural resources management on the regional level, while continuing efforts on eradicating corruption.Novelty/Originality–Few researchers consider the role of corruption as a moderator in the relationship between fiscal decentralization and natural resources on economic growth. This study fills this gap by incorporating a moderating role of corruption that may weaken the ability of fiscal decentralization and natural resources to promote economic growth with the evidence from Indonesia’s provinces.

Anteseden of Competitive Strategy and Implications for Improving MSMEs' Performance

The development of the tourism sector contributes to economic growth in Indonesia. This can be seen from visitors to Indonesian tourism objects experiencing an increase after Covid-19 occurred, especially after Indonesia hosted World Tourism Day. The purpose of this study is to be the basis for MSMEs in the Tourism and Creative Economy Sector of Samosir Regency in increasing the number of visitors to travel through the implementation of competitive strategies and the use of digitalization as well as understanding the importance of transformational leadership styles by MSME actors so that MSME performance can be improved and contribute to economic growth in Samosir Regency. The sample of this study amounted to 150 MSMEs with cluster random sampling technique. These MSMEs consist of two sub-districts, namely Tomok and Pangururan sub-districts, clustering MSME actors in the tourism sector, namely Accommodation, Restaurants, Entertainment, MSMEs in the field of Creative Products. Data analysis techniques use quantitative descriptive using SEMPLS. The results of the study found that the use of digitalization has not optimally had an impact on MSME performance but was able to significantly affect the competitive strategy seen from the use of digital platforms in the marketing process and facilitate transactions so as to provide good competitiveness to improve the tourism sector. MSME actors in the tourism sector in Samosir Regency have not been able to implement a transformational leadership style that directly affects their business performance, this can be seen from the role of the owner is still unable to adapt to changes that occur, especially in the tourism sector. And the application of competitive strategies, namely product strategy, price and distribution is a factor that has a positive and significant influence on the performance of MSMEs.

The Role of Information and Communication Technology (ICT) and Tourism on Economic Growth in Indonesia

This study aims toanalyze the influence of ICT and the tourism sector on economic growth in Indonesia from 2015 to 2021 using panel data regression analysis on a total of 238data with the Feasible Generalized Least Square-Seemingly Unrelated Regression (FGLS-SUR) estimation method. The results of the study show that the proportion of individuals who use the internet, the number of fixed broadband subscribers, the room occupancy rate of star hotels, foreign investment, labour, and government spending have a positive and significant effect on economic growth in Indonesia. In this regard, it is hoped that each province will have equal access to the internet and further enhance hotel services, especially for star-rated hotels.The positive impact of this research in Indonesia is that it can help enhance the Gross Regional Domestic Product (GRDP) in each province, thereby influencing overall economic growththrough the fields of ICT and tourism.

Konsumsi Energi Fosil Terhadap Pertumbuhan Ekonomi

The research aims to determine the correlation between fossil energy consumption and economic growth in Indonesia. The data uses in this research was a 6-year period, of secondary data, starting form 2018 to 2023, obtained from the Ministry of Energy and Mineral Resources (ESDM) for the fossil energy consumption variable and the Central Statistics Agency (BPS) for the economic growth variable. The analytical method used in this research was simple linear regression analysis using SPSS 24 software tools. The research results showed that fossil energy consumption had a positive effect in Indonesia economic growth. The research indicated that fossil energy consumption was able to increase Indonesian economic growth by 64,7%. Keywords: energy consumption (fossil), economic growth

M Score Performance Measure for Islamic Banks in Malaysia and Indonesia

Performance measurement is vital to examine the performance of any institution. Due to the different nature of business operations, processes, and activities in Islamic banks, they have to be measured by a more focused instrument to reflect the Shariah compliance parts and their business nature compared to the conventional banks. Hence, M Score which has been developed by Abdul Rahim, Abdul Rahman and Syed AlHabshi (2016) has been adopted in this study. The findings from the computation will indicate which country gains the higher M Score in performance, and this can be used as a benchmarking exercise. This research aims to analyse and compare the M Score performance of Islamic banks in Malaysia and Indonesia. The content analysis via Annual Reports of Islamic banks has been used for this study. The sampling technique used is purposive sampling. The research was conducted on Islamic banks in Malaysia and Indonesia over a period of two years, from 2020-2021. This comparative research is expected to be an evaluation tool for Malaysian Islamic banks, helping them improve their performance to catch up with their counterparts in Indonesia. Thus, the purpose of this research proposal is to analyse and compare the effect of the soundness of Islamic banks based on the M Score performance of Islamic banks in Malaysia and Indonesia. The results of this study indicate that Islamic banks in Indonesia have a higher M Score ranking than those in Malaysia. There are significant differences in the performance of Islamic banks based on the Need Fulfilment and Equitable Distribution (NFED), Economic Growth (EG), and Economic Stability (ES) in Malaysia and Indonesia.

Current status of Indonesia’s palm oil products and their competitiveness in the global market

Abstract Oil palm is recognised as contributing significantly to crucial economic growth in Indonesia. Still, it is often considered a severe threat to tropical forest ecosystems due to the large amount of forest conversion for oil palm cultivation. Also, oil palm business and marketing processes have many opportunities and challenges. In response, this research examines and reveals in depth the current state of Indonesia’s palm oil business and marketing in the global market. By interviewing, reviewing the literature, and conducting a stakeholder analysis, we found that Indonesia has high competition for global palm oil, with processed products such as Refined Palm Oil and Oleochemical Mix dominating the world market and high export value growth. However, the export value for crude oil, such as palm oil and palm kernel oil, in 2020 - 2021 is low due to government policies for downstream and industrialisation programs. The government, as policymakers, the oil palm funding agency (BPDPKS), and the oil palm companies are key players with high interest and influence in the sustainable development of the oil palm business. European Union and Press can be context setters with low interest but high influence on business and marketing processes in Indonesia.

Analysis of The Interaction of Monetary Policy and Islamic Investment Towards Indonesia's Economic Growth

Economic growth is the main measure of development success, and the results of economic growth will be enjoyed by the community either by itself or with government intervention. Economic growth is an important indicator in the real sector. The interaction between monetary policy and sharia investment in influencing Indonesia's economic growth is the main focus of this study. This study aims to analyze the effect of the interaction of monetary policy (interest rates, exchange rates and money supply) and the interaction of sharia investment (sukuk, sharia stocks, sharia mutual funds) on Indonesia's economic growth for the period 2000-2022. This type of research is quantitative research using time series data from secondary data with the Vector Error Correction Model (VECM) analysis method with the help of Eviews software. The results of this study indicate that the variables of short-term interest rates, SUKUK, sharia stocks, sharia mutual funds have a positive and significant effect on economic growth, while the rupiah exchange rate (KURS), the amount of money in circulation on economic growth show a negative and insignificant effect. The variables of long-term interest rates, rupiah exchange rates or KURS, the amount of money in circulation SUKUK, sharia stocks, mutual funds have a positive and significant effect on economic growth

The Effect of Local Government Characteristics on GRDP in Indonesia during the Pandemic Period

This research aims to analyze the influence of local government characteristics, specifically Gross Regional Domestic Product (GRDP), on Indonesia during the pandemic. Economic growth is a key component of the Sustainable Development Goals (SDGs), as outlined in point eight of the 17 SDG goals. The Covid-19 pandemic has significantly impacted local government administration, leading to a decrease in regional income in some regions of Indonesia. This research employs a quantitative approach, utilizing multiple linear regression analysis for the analysis. The results reveal that the variables of area size and the number of Regional Apparatus Organizations (OPD) do not have a significant impact on economic growth in Indonesia. In contrast, the variable of Regional Original Income (PAD) demonstrates a significant influence on Indonesia’s economic growth. Moreover, when considered simultaneously, the area size, the number of OPD, and PAD collectively exert a significant impact on the economic growth in Indonesia during the pandemic. These findings suggest that local governments should allocate greater efforts and resources to foster economic growth, recognizing it as a crucial element for achieving the SDGs in Indonesia. Keywords: economic growth, local government characteristics, Sustainable Development Goals (SDGs)

Pengaruh Jumlah Uang Elektronik yang Beredar di Masyarakat Terhadap Pertumbuhan Ekonomi Indonesia

Economic growth is a value that shows the level of production of goods and services achieved by a country so that it can reflect the state of the country's economy. Payments using non-cash or frequently used money such as electronic money are considered more efficient and economical, so the value of electronic money transactions increases every year. This research analyzes the influence of the value of electronic money transactions, money supply and inflation on Indonesia's economic growth, in this case GDP. Secondary data from 2018 to 2022. The data analysis method used is multiple linear regression. From the results of the tests that have been carried out, values were foundelectronic money transactions, money supply (JUB), and inflation has a significant effect on economic growth in Indonesia. The higher the value of electronic money transactions and inflation can increase economic growth, but the greater the money supply, the lower economic growth (GDP).