The Effect of Government Debt on Indonesia's Economics Growth

Authors

  • Trian Hutaria  Economics, IPB University, Bogor, West Java, Indonesia
  • Bambang Juanda  Economics, IPB University, Bogor, West Java, Indonesia
  • Yeti Lis Purnamadewi  Economics, IPB University, Bogor, West Java, Indonesia

DOI:

https://doi.org// 10.32628/IJSRSET196523

Keywords:

Bugdet Deficit, GDP, Government Debt, Government Expenditure

Abstract

The current development in Indonesia had changed the structure of the budget, because an increased in government expenditure had caused budget deficits. One of solutions to overcome budget deficit is debt. During the period 2014-2017 the government debt profil had an average growth of 13%, which was higher than the average of economic growth. This study aims to analyze the effects of government debt on the Gross Domestic Product (GDP) via three types of government expenditure during the period of 1981-2017. The method used in this research was Two Stage Least Square with the simultaneous regression. The result show that government debt had significant effect on capital and regional expenditure, but did not significantly influence employee expenditure. Meanwhile, the capital and regional expenditure had significant effects on GDP. The highest multiplier effect affecting GDP was regional expenditure.

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International Journal of Scientific Research in Science, Engineering and Technology

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Published

2019-10-30

Issue

Volume 6, Issue 5, September-October-2019

Section

Research Articles

License

Copyright (c) IJSRSET

Creative Commons License

This work is licensed under a Creative Commons Attribution 4.0 International License.

How to Cite

[1]
Trian Hutaria, Bambang Juanda, Yeti Lis Purnamadewi, " The Effect of Government Debt on Indonesia's Economics Growth, International Journal of Scientific Research in Science, Engineering and Technology(IJSRSET), Print ISSN : 2395-1990, Online ISSN : 2394-4099, Volume 6, Issue 5, pp.125-130, September-October-2019. Available at doi : https://doi.org/ 10.32628/IJSRSET196523