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Analysis of Factors Affecting Inflation and its Impact on Human Development Index and Poverty in Indonesia

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  • Y. Yolanda

Abstract

This study has the objective to analyze the effect that occurs between Indonesian Bank (BI)- rate, Foreign Exchange Rates, Money Supply, oil price and gold prices on Inflation, its impact on human development Index (HDI) and poverty in Indonesia for the period 1997 up to 2016. This study used secondary data with purposive sampling method. Methods of data analysis using multiple regression analysis, Model 1: Results of this study indicate that there are significant variables simultaneously at BI Rate, Foreign Exchange Rates, Money Supply, oil price and gold prices to the level of inflation in Indonesia. The results also showed variable BI rate, money supply, oil price and gold prices partial effect on the level of inflation positively and significantly, while the exchange rate variable does not affect the rate of inflation. The results determinant coefficient of 0.9497means the ability of independent variables to explain the dependent variable of 94.97 % , while the remaining 5,03 % is influenced by other variables and are not included in this study. Model 2: inflation on HDI is significant and positif and model 3: Inflation on poverty is significant and positive.

Suggested Citation

  • Y. Yolanda, 2017. "Analysis of Factors Affecting Inflation and its Impact on Human Development Index and Poverty in Indonesia," European Research Studies Journal, European Research Studies Journal, vol. 0(4B), pages 38-56.
    • Handle: RePEc:ers:journl:v:xx:y:2017:i:3b:p:38-56
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