Do Credit Channel and Interest Rate Channel Play Important Role in Monetary Transmission Mechanism in Indonesia?: A Structural Vector Autoregression Model

Wulandari, Ries

doi:10.1016/j.sbspro.2012.11.165

Cited by 44 publications

(29 citation statements)

References 7 publications

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“…There are several other studies which focus on monetary policy transmission mechanisms through credit lines affecting the real sector, such as Oliner's (1996) research which finds that credit lines are more relevant for developing countries because they are based on premises, as well as the researches conducted by Azali (1999) with a case study in Malaysia, and Ramlogan (2007) in Trinidad and Tobago. For more, Nuryati (2004) and Wulandari (2012) studies with case studies in Indonesia note that credit lines play an important role in MTKM in maintaining inflation, while credit lines effectively affect economic growth.…”

Section: Resultsmentioning

confidence: 99%

“…While Natsir (2009aNatsir ( , 2009b concludes that the channel rate channel path and inflation expectation path effectively reached the final target of monetary policy in 1990: 2 -2007: 1. Again, Wulandari (2012) finds that the interest rate path is more effective for controlling inflation, while the credit line is more effective to influence economic growth. Regarding to previous researches above, the research gaps indicate that a research on which paths are most effective in MTKM is still relevant to do.…”

Section: Introductionmentioning

confidence: 98%

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Effectiveness of Monetary Policy Transmission Mechanism in Indonesia

Hayati

2018

jejak

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This research aimed to analyse monetary mechanism effectivity to manage inflation in Indonesia through interest rate channel, credit channel, and expectation inflation channel. The research used Vector Error Correction Model (VECM) to analyze effectiveness of monetary policy transmission mechanism in Indonesia. The most effective channel was measured by result of Impulse Response Function and Variance Decomposition. They are: (1). The fastest time lag needed since the shock of monetary instruments (rSBI) until the realization of final target of monetary policy (inflation). (2). How strong the variables in each channel response the shock of SBI interest rate and other variable. The data used in this research is quarterly time series dara from 2005Q1 until 2016Q4. The results of this research show that the most effective channel in managing inflation during 2005Q1 until 2016Q4 is inflation expectation channel.

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Section: Resultsmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 98%

Effectiveness of Monetary Policy Transmission Mechanism in Indonesia

Hayati

2018

jejak

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“…The interest rate channel plays a vital role in the monetary policy transmission mechanism in maintaining inflation. (Wulandari 2012). Transmission problems, as well as monetary policy shocks, tend to affect slower output for more extended periods (Hsing, 2015).…”

Section: Introductionmentioning

confidence: 99%

Monetary Policy Transmission : Does Maintain the Price and Poverty Stability is Effective?

Novalina

Rusiadi

2018

jejak

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This study analyzes the effectiveness of monetary policy transmission of emerging market countries, both short and long-term in maintaining economic stability and reducing poverty. The main problem in this paper is that monetary transmission is incapable of controlling the economy and reducing poverty. There are five countries selected such as India, Brazil, China, Russia, and Indonesia. Long-term prediction analysis using Vector Auto Regression (VAR) model is performed to predict five emerging market countries using Regression Panel. It results suggest that monetary policy transmission affecting the number of poor people should be controlled in three stages. In the short-term, the transmission of export variables and inflation controls the number of poor people. In the medium-term, the control of the number of poor people uses variables of inflation and exports while in the long-term uses exports and Gross Domestic Product (GDP). Overall, all economic variables of emerging market countries are greatly influenced by the fluctuations of each country's exports, then by food price stability as measured by food price inflation. The result of regression panel analysis is known that the factor that most influence the poor people in emerging market country is GDP. Exports also affect poor people such as Indonesia, China, and Russia. Inflation also causes poor people like India and Brazil. The countries that have the most impact on economic fluctuations on the number of poor people are India, Indonesia, China, Brazil, and Russia.

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“…Based on the identification of company obtained information that nearly 50% of customers who complained the quality of service companies such as the length of time of production, the credit period is short, long in response to complaints, and so on [7] [8]. For determining suitable strategies, then need to research applying the method of Importance Performance analysis and potential gain customer value simultaneously.…”

Section: Introductionmentioning

confidence: 99%