MONETARY AND FISCAL POLICY ANALYSIS: WHICH IS MORE EFFECTIVE?

https://doi.org/10.22146/jieb.6470

Muhamad Yunanto(1*), Henny Medyawati(2)

(1) Gunadarma University
(2) Gunadarma University
(*) Corresponding Author

Abstract


Fiscal policy is an adjustment in the income and expenditure of government as stipulated in the state budget in order to achieve better economic stability and pace of development. The main objective of this study was to measure and analyze Fiscal and Monetary Policy of the Gross Domestic Product (GDP). Fiscal Policy Multiplier (FPM) and Monetary Policy Multiplier (MPM) are used to answer the debate where more effective between fiscal policy and monetary policy. Short-term models derived through error correction model (ECM), which also forms the derivative equation. A system of simultaneous equations two stage least squares (TSLS), is used to describe the sensitivity analysis (response) of shocks to the policy change of important macroeconomic indicators. The results showed that during the study period, Indonesia's monetary policy more effective than fiscal policy.


Keywords


monetary policy, fiscal policy, Mundell-Flemming Model

Full Text:

PDF



DOI: https://doi.org/10.22146/jieb.6470

Article Metrics

Abstract views : 1423 | views : 1653

Refbacks

  • There are currently no refbacks.




Copyright (c)



Journal of Indonesian Economy and Business

Journal

Editorial Team
Focus and Scope
Peer Review Process
Publication Ethics
Screening for Plagiarism

Authors

Author Guidelines
Submission Guidelines
Online Submissions
Copyright Notice
Privacy Statement
Author Fees

Download

Author Pack
Submission Form & Manuscript Template

 

Reviewer

Reviewer Guidelines
Reviewer Acknowledgement

 

Reader

General Search
Achieves
Author index
Title index

 

 

The Journal of Indonesian Economy and Business (print ISSN 2085-8272; online ISSN 2338-5847) is published by the Faculty of Economics and Business Universitas Gadjah Mada, Indonesia. The content of this website is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License

© 2019 Journal of Indonesian Economy and Business 
 Visitor Statistics