ANALYSIS OF INFLATION AND INTEREST RATES ON THE ECONOMIC GROWTH IN INDONESIA

  • Efi Fitriani STIE Ekuitas, Indonesia
Keywords: inflation, interest rate, economic growth

Abstract

This study aims to determine the effect of inflation and interest rate on economic growth in Indonesia and to determine the strategy of increasing economic growth in Indonesia. The data were analyzed using descriptive analysis and regression analysis. The descriptive analysis explained that the growth of inflation and interest rate. Based on regression analysis, there is a positive influence between inflation on economic growth and the negative influence between the interest rate on economic growth in Indonesia. Strategies for increasing economic growth through human resources, entrepreneurs, employment, investment, export, and infrastructure.

Downloads

Download data is not yet available.

References

Boediono. 2014. Synopsis Series Introduction to Science - No. 5 Macroeconomics. Yogyakarta: BPFE (translated from Indonesian: Seri Sinopsis Pengantar Ilmu - No. 5 Ekonomi Makro. Yogyakarta: BPFE).

Mutinda, D. M. (2014). The effect of lending interest rate on economic growth in Kenya. A Research Project, The University of Nairobi, Kenya.

Ayo, O. S., Ifeakachukwu, N. P., & Ditimi, A. (2011). A trivariate causality test among economic growth, government expenditure and inflation rate: Evidence from Nigeria. The Journal of World Economic Review, 6(2), 189-199.

Dornbusch, Rudiger, Stanley Fischer, dan Richard Startz. 2008. Macroeconomics. 10th Eds. New York: McGraw-Hill Companies.

Guru, S. 2015. The structural theory of inflation explained. Retrieved from doi: http://www.yourarticlelibrary.com/macroeconomics/inflationmacroeconomics/thestructuraltheory ofinflationexplained/37980/. Accessed on 12/15/2015.

Ismail, 2010. Banking Management. Jakarta: Kencana Prenada Media Group. (translated from Indonesian: Manajemen Perbankan. Jakarta: Kencana Prenada Media Group).

Latumaerissa, Julius.R, 2011. Banks and Other Financial Institutions. Jakarta: Salemba Empat (translated from Indonesian: Bank dan Lembaga Keuangan Lain. Jakarta: Salemba Empat).

Mamo, F.T. 2012. Economic growth and inflation: A panel data analysis. Master’s Thesis. Department of Social Sciences, Economics, Södertörns University, Sweden.

Mankiw, Gregory N. 2004. Principles of macroeconomics. 3rd eds. The Dryden Press

Mankiw, Gregory. 2012. Principles of Macroeconomics. 6th eds. Canada: Cengage Learning.

Maiga, F. K. (2017). Impact of interest rate on economic growth in Nigeria. Pyrex Journal of Business and Finance Management Research, 3(3), 98-111.

Mishkin, F. S. (2008). Money Economics, Banking and Financial Markets. Jakarta: Salemba Empat. (translated from Indonesian: Ekonomi Uang, Perbankan, dan Pasar Keuangan. Jakarta: Salemba Empat).

Novianto, A., SBM, N., & Nugroho, S. B. M. (2011). Analysis of the effects of exchange rates (exchange rates) of US Dollar / Rupiah (US $ / Rp), SBI Interest Rates, Inflation, and amount of money supply (M2) on the Composite Stock Price Index (CSPI) on the Indonesia Stock Exchange (BEI) 1999.1– Period 2010.6. Doctoral dissertation. Universitas Diponegoro. (translated from Indonesian: Analisis pengaruh nilai tukar (Kurs) Dolar Amerika/Rupiah (US $/Rp), Tingkat Suku Bunga SBI, Inflasi, dan jumlah uang beredar (M2) terhadap Indeks Harga Saham Gabungan (IHSG) di Bursa Efek Indonesia (Bei) Periode 1999.1–2010.6. Doctoral dissertation. Universitas Diponegoro).

Obansa, S. J., Okoroafor, O. D., Aluko, O. O., & Eze, M. (2013). Percieved Relationship between Exchange Rate, Interest Rate and Economic Growth in Nigeria: 1970-2010. American journal of humanities and social sciences, 1(3), 116-124.

Putong, I., & Andjaswati, N. D. (2010). Introduction to Macro Economics. Jakarta: Mitra Wacana Media. (translated from Indonesian: Pengantar Ekonomi Makro. Jakarta: Mitra Wacana Media).

Samuelson, P. A., & Nordhaus, W. D. (2004). Macroeconomics. Jakarta: PT. Media Edukasi. (translated from Indonesian: Ilmui Makro Ekonomi. Jakarta: PT. Media Edukasi).

Sattarov, K. (2011). Inflation and Economic Growth. Analyzing the Threshold Level of Inflation.: Case Study of Finland, 1980-2010. Master Thesis, 15 ECTS. Universitet UMEA.

Snowdon, B., & Vane, H. R. (2005). Modern macroeconomics: its origins, development and current state. Edward Elgar Publishing.

Sukirno, S. (2013). Macroeconomics introduction theory. 3rd Eds. Jakarta: Rajawali Pers. (translated from Indonesian: Makroekonomi Teori Pengantar. Edisi ketiga. Jakarta : Rajawali Pers).

Sunariyah. (2013). Introduction to capital market knowledge. Yogyakarta: UPP-STIM YKPN. (translated from Indonesian: Pengantar pengetahuan pasar modal. Yogyakarta: UPP-STIM YKPN).

Udoka, C. O., & Anyingang, R. A. (2012). The effect of interest rate fluctuation on the economic growth of Nigeria, 1970-2010. International Journal of Business and Social Science, 3(20), 295-302.

Wuri, J. (2018). The role of investment to the Indonesian economic growth. Journal of Business and Finance in Emerging Markets, 1(2), 161-174.

Published
2019-11-13
Section
Articles