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ANALISIS PERILAKU INSTABILITAS, PERGERAKAN HARGA, EMPLOYMENT DAN INVESTASI DI DALAM SEKTOR PERTANIAN INDONESIA: Aplikasi Vector Error Correction Model

Author

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  • Andi Irawan

    (IPB)

Abstract

In a long run perspective, the aim of this research is to analyze the impact of the inflating- policy on the employment growth, and the agriculture investment. From a short run perspective, the aim covers (1) the identification of agriculture price instability on certain economic blocks, (2) the analysis of inflation behavior in the agriculture sector and its causality both to output price and input prices and the causality within the input prices. We apply the Vector Error Correction Model, Johansen Cointegration Test, and Granger Causality Test on a monthly series data from 1993:01 to 2002:12. The result shows the production and capital in agriculture sector are responsive to the output price change. This mean inflating the output price will effectively help to generate the output and a new investment in this sector. However, as the price shock can be a source of instability, the government should be careful to apply this price inflating policy. In addition, to solve the unemployment problem in agriculture sector, the government should apply the cost strategy, such as input price subsidy policy.

Suggested Citation

  • Andi Irawan, 2005. "ANALISIS PERILAKU INSTABILITAS, PERGERAKAN HARGA, EMPLOYMENT DAN INVESTASI DI DALAM SEKTOR PERTANIAN INDONESIA: Aplikasi Vector Error Correction Model," Bulletin of Monetary Economics and Banking, Bank Indonesia, vol. 8(1), pages 1-38, June.
    • Handle: RePEc:idn:journl:v:8:y:2005:i:1:p:1-38
    DOI: https://doi.org/10.21098/bemp.v8i1.129
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    More about this item

    Keywords

    Employment; Investasi; Agriculture; Johansen; Cointegration Vector Error Correction Model; Causality Test;
    All these keywords.

    JEL classification:

    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • C52 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Evaluation, Validation, and Selection
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • Q11 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Aggregate Supply and Demand Analysis; Prices
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy; Animal Welfare Policy

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