Title of article
An Analysis of the Effect of Consumption Spending and Investment on Indonesia’s Economic Growth
Author/Authors
Rafiy, Muhammad Department of Economics - Faculty of Economics and Business - Universitas Halu Oleo - Kendari - Indonesia , Adam, Pasrun Department of Mathematics - Faculty of Math and Science - Universitas Halu Oleu - Kendari - Indonesia , Bachmid, Gamsir Department of Economics - Faculty of Economics and Business - Universitas Halu Oleo - Kendari - Indonesia , Saenong, Zainuddin Department of Economics - Faculty of Economics and Business - Universitas Halu Oleo - Kendari - Indonesia
Pages
14
From page
757
To page
770
Abstract
This study aims to examine the effect of investment and consumption spending on Indonesia’s economic growth. The data used is the quarterly time series data from the first quarter of year 2003 to the fourth quarter of year 2013, comprising consumption spending, investment and economic growth. For the purpose of analysis, the autoregressive distributed lag (ARDL) model is used. The result of the study reveals that there are long-run and short-run effects of consumption spending on economic growth. Meanwhile, the effect of investment on economic growth is not significant. The study also reveals that the increase in government spending on economic growth is 1.88% if the consumption spending rises by 1%.
Keywords
Consumption Spending , Investment , Economic Growth , ARDL Model
Journal title
Iranian Economic Review (IER)
Serial Year
2018
Record number
2504999
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