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Indonesia Economic Growth Determinant: The Impact of Macro Economic Variables and International Trade

Author

Listed:
  • Ely Susanti

    (Magister Student of Economic Education, Yogyakarta State University, Colombo Street No. 1 Karang Malang, Caturtunggal Distrik, Yogyakarta Province 55281, Indonesia,)

  • Maimun Sholeh

    (Departement of Economic Education, Faculty of Economics, Yogyakarta State University, Colombo Street No. 1 Karang Malang, Caturtunggal Distrik, Yogyakarta Province 55281, Indonesia.)

Abstract

The economic growth is one of measurements for a country to be categorized as a developed country. The basic things in economy are monetary stability and fiscal. Monetary stability can be seen from the government s success in controlling inflation flow and restraining interest rates meanwhile fiscal policy can be seen from rate of exchange sector and free trade. Considering those basic conditions, this research is aimed to study the impact of inflation, interest rates, exchange rates, and free trade toward the economy of Indonesia. This research uses data time series from Q1 2009 Q1 2020 by using Ordinary Least Square (OLS) model. The result of this research shows that interest rates, exchange rates, and import affect the economic growth, meanwhile inflation and export do not affect the economic growth.

Suggested Citation

  • Ely Susanti & Maimun Sholeh, 2020. "Indonesia Economic Growth Determinant: The Impact of Macro Economic Variables and International Trade," International Journal of Economics and Financial Issues, Econjournals, vol. 10(5), pages 70-76.
    • Handle: RePEc:eco:journ1:2020-05-7
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    References listed on IDEAS

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    More about this item

    Keywords

    Macroeconomic variable; free trade; economic growth; Indonesia;
    All these keywords.

    JEL classification:

    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • E43 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Interest Rates: Determination, Term Structure, and Effects
    • F10 - International Economics - - Trade - - - General
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies

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