2021
DOI: 10.3390/economies9040174
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The Impact of Industrialization, Trade Openness, Financial Development, and Energy Consumption on Economic Growth in Indonesia

Abstract: This study aimed to scrutinize the impact of financial development, energy consumption, industrialization, and trade openness on economic growth in Indonesia over the period 1984–2018. To do so, the study employed the autoregressive distributed lag (ARDL) model to estimate the long-run and short-run nexus among the variables. Furthermore, fully modified ordinary least squares (FMOLS), dynamic least squares (DOLS), and canonical cointegrating regression (CCR) were used for a more robust examination of the empir… Show more

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Cited by 37 publications
(13 citation statements)
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References 33 publications
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“…The results highlighted that a 1% increase in trade openness declines economic growth by 0.18%, in the long run, keeping other things constant. These findings are consistent with the existing studies such as [16][17][18]20] for Indonesia, India, and Pakistan, respectively. However, this finding contradicts other previous findings such as [13] in 19 Asian countries, [1] in five emerging countries, [6] in Latin America, and [21].…”
Section: Unit Rootsupporting
confidence: 93%
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“…The results highlighted that a 1% increase in trade openness declines economic growth by 0.18%, in the long run, keeping other things constant. These findings are consistent with the existing studies such as [16][17][18]20] for Indonesia, India, and Pakistan, respectively. However, this finding contradicts other previous findings such as [13] in 19 Asian countries, [1] in five emerging countries, [6] in Latin America, and [21].…”
Section: Unit Rootsupporting
confidence: 93%
“…Elfaki et al [16] used the ARDL model to examine how trade openness affected Indonesia's economic growth from 1984 to 2018. They found that the growth of Indonesia's economy was negatively impacted by trade openness.…”
Section: Literature Reviewmentioning
confidence: 99%
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“…It indicates that when more and more industries grow and develop, it can encourage additional tax revenues that can be collected by the state. Industry penetration is one of the factors that determines the economic strength of a country because it is a very important p-ISSN: 2503-4235 driving engine for economic growth (Azolibe & Okonkwo, 2020) (Elfaki et al, 2021). One of the drivers of the industrial sector for OIC countries is the fact that many of its member countries are producers of oil and other natural resources.…”
Section: Discussionmentioning
confidence: 99%
“…This test uses Johansen's cointegration test method. In the third stage, to ensure the strength of the research results in testing long-term relationships, cointegration regression with the Fully Modified Ordinary Least Squares (FMOLS) and Dynamic Ordinary Least Squares (DOLS) approaches was applied (Elfaki et al, 2021;Mardhani et al, 2021).…”
Section: Econometric Methodologymentioning
confidence: 99%