Economic Development Analysis Journal
Vol 9 No 2 (2020): Economics Development Analysis Journal

Testing of the Phillips Curve in Indonesia

Mochamad Choirul Anwar (Jurusan Ekonomi Pembangunan, Fakultas Ekonomi, Universitas Negeri Semarang)
Avi Budi Setiawan (Jurusan Ekonomi Pembangunan, Fakultas Ekonomi, Universitas Negeri Semarang)



Article Info

Publish Date
26 Jul 2020

Abstract

This study aims to determine how the results of Phillips theory testing in 34 provinces in Indonesia based on the main sectors contributing to the GRDP. The analytical method used in this study is Product Moment correlation analysis to determine the relationship between the inflation rate variable and the unemployment rate variable. The data used in this study are data on open unemployment and inflation rates taken in 34 provinces in Indonesia from 2014-2018. The results of this study indicate there is no Phillips curve pattern in 34 provinces in Indonesia. The inflation rate variable and the unemployment rate variable in 34 provinces in Indonesia based on the main sectors contributing to the GRDP have a positive but very weak relationship with a correlation value of 0.1089. The problem of price volatility (inflation) contributes, although not significantly to the emergence of the unemployment problem. Government policies are needed to control inflation and reduce unemployment rates such as fuel subsidies, corporate tax reductions, export tax reductions, and control of raw material prices considering that the results of this study indicate that rising inflation will be followed by an increase in unemployment.

Copyrights © 2020






Journal Info

Abbrev

edaj

Publisher

Subject

Economics, Econometrics & Finance

Description

Focus and Scope Economic Development Analysis Journal is a scientific journal who published by Department of Economic Development, Faculty of Economics, Universitas Negeri Semarang, Indonesia. this journal published four times per year on February, May, August, and November and start publishing ...