Examining the Impact of Economic Growth, Poverty and Unemployment on Inflation in Indonesia (2000-2019): Evidence from Error Correction Model
The study examines the causal relationship of economic growth, poverty, unemployment, and inflation in Indonesia from 2000 to 2019. The data analyzed are sourced from World Bank Indicators from The World Bank. The variables studied were inflation as the dependent variable and economic growth, the le...
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Universitas Muhammadiyah Yogyakarta
2023-03-01
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| Series: | Jurnal Studi Pemerintahan |
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| Online Access: | https://jsp.umy.ac.id/index.php/jsp/article/view/30 |
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| author | Rosdiana Sijabat |
| author_facet | Rosdiana Sijabat |
| author_sort | Rosdiana Sijabat |
| collection | DOAJ |
| description | The study examines the causal relationship of economic growth, poverty, unemployment, and inflation in Indonesia from 2000 to 2019. The data analyzed are sourced from World Bank Indicators from The World Bank. The variables studied were inflation as the dependent variable and economic growth, the level of poverty, and the unemployment rate, inflation, as an independent variable. The results of the Augmented Dicky-Fuller test show that there is a unit root problem because all variables are not stationary at the level, so it is continued by doing first differencing, and stationary data is found in the first difference or I(1). Using the Vector Error Correction Model (VECM), this study found a significant long-term relationship between inflation (INF), economic growth (GP), the poverty rate (POV), and the unemployment rate (UNEMP). Meanwhile, in the short term, economic growth and poverty rates have a significant adverse effect on inflation. The results have important policy implications, specifically, the urgency of government policies and interventions to encourage the expansion of economic activities that promote economic growth and eradicate poverty. |
| format | Article |
| id | doaj-art-9b1389b80193468085f14274c21e0c25 |
| institution | Kabale University |
| issn | 1907-8374 2337-8220 |
| language | English |
| publishDate | 2023-03-01 |
| publisher | Universitas Muhammadiyah Yogyakarta |
| record_format | Article |
| series | Jurnal Studi Pemerintahan |
| spelling | doaj-art-9b1389b80193468085f14274c21e0c252025-02-03T07:37:42ZengUniversitas Muhammadiyah YogyakartaJurnal Studi Pemerintahan1907-83742337-82202023-03-01255810.18196/jgp.v13i1.1229730Examining the Impact of Economic Growth, Poverty and Unemployment on Inflation in Indonesia (2000-2019): Evidence from Error Correction ModelRosdiana Sijabat0Universitas Katolik Indonesia Atmajaya JakartaThe study examines the causal relationship of economic growth, poverty, unemployment, and inflation in Indonesia from 2000 to 2019. The data analyzed are sourced from World Bank Indicators from The World Bank. The variables studied were inflation as the dependent variable and economic growth, the level of poverty, and the unemployment rate, inflation, as an independent variable. The results of the Augmented Dicky-Fuller test show that there is a unit root problem because all variables are not stationary at the level, so it is continued by doing first differencing, and stationary data is found in the first difference or I(1). Using the Vector Error Correction Model (VECM), this study found a significant long-term relationship between inflation (INF), economic growth (GP), the poverty rate (POV), and the unemployment rate (UNEMP). Meanwhile, in the short term, economic growth and poverty rates have a significant adverse effect on inflation. The results have important policy implications, specifically, the urgency of government policies and interventions to encourage the expansion of economic activities that promote economic growth and eradicate poverty.https://jsp.umy.ac.id/index.php/jsp/article/view/30inflationunemploymentpovertyeconomic growthvector error correction model |
| spellingShingle | Rosdiana Sijabat Examining the Impact of Economic Growth, Poverty and Unemployment on Inflation in Indonesia (2000-2019): Evidence from Error Correction Model Jurnal Studi Pemerintahan inflation unemployment poverty economic growth vector error correction model |
| title | Examining the Impact of Economic Growth, Poverty and Unemployment on Inflation in Indonesia (2000-2019): Evidence from Error Correction Model |
| title_full | Examining the Impact of Economic Growth, Poverty and Unemployment on Inflation in Indonesia (2000-2019): Evidence from Error Correction Model |
| title_fullStr | Examining the Impact of Economic Growth, Poverty and Unemployment on Inflation in Indonesia (2000-2019): Evidence from Error Correction Model |
| title_full_unstemmed | Examining the Impact of Economic Growth, Poverty and Unemployment on Inflation in Indonesia (2000-2019): Evidence from Error Correction Model |
| title_short | Examining the Impact of Economic Growth, Poverty and Unemployment on Inflation in Indonesia (2000-2019): Evidence from Error Correction Model |
| title_sort | examining the impact of economic growth poverty and unemployment on inflation in indonesia 2000 2019 evidence from error correction model |
| topic | inflation unemployment poverty economic growth vector error correction model |
| url | https://jsp.umy.ac.id/index.php/jsp/article/view/30 |
| work_keys_str_mv | AT rosdianasijabat examiningtheimpactofeconomicgrowthpovertyandunemploymentoninflationinindonesia20002019evidencefromerrorcorrectionmodel |