EKSPEKTASy
Vol. 3 No. 2 (2024): JOURNAL EKSPEKTASy

The Effect of Micro, Small, and Medium Enterprises (MSMEs) on Gross Regional Domestic Product (GRDP): Evidence from Bandung Regency, Indonesia (2019–2023)

Anwar, Miftah Khaerul (Unknown)



Article Info

Publish Date
30 Dec 2024

Abstract

Micro, Small, and Medium Enterprises (MSMEs) are widely recognized as the backbone of regional economic development in Indonesia, yet empirical evidence at the regency (kabupaten) level remains relatively scarce, particularly for high-population peri-urban areas. This study examines the effect of MSMEs on Gross Regional Domestic Product (GRDP) in Bandung Regency, West Java, over the five-year period 2019–2023 a window that spans the COVID-19 economic shock and the post-pandemic recovery. Adopting a quantitative explanatory design, the study analyses annual time-series data on the number of registered MSMEs and current-price GRDP, drawn from Statistics Indonesia (BPS) and the Bandung Regency Office of Cooperatives and MSMEs. Three statistical procedures were applied: Pearson Product-Moment correlation, simple linear regression, and the t-test for coefficient significance. Results show a very strong positive correlation between MSMEs and GRDP (r = 0.961, p = 0.009) and a coefficient of determination (R²) of 0.924, indicating that approximately 92.4% of the variation in GRDP is explained by changes in the number of MSMEs. The regression coefficient (b = 1,069.998, t = 6.052 > t-t-table 2.353, p < 0.05) confirms that MSMEs have a statistically significant positive effect on GRDP. The findings reinforce the strategic role of MSMEs as a driver of regional output but also reveal a structural anomaly: the disproportionate jump in MSME registrations in 2022 (a 106.9% increase) reflects a registration-policy effect rather than organic growth, raising questions about the validity of MSME counts as proxies for productive activity. The study recommends that local governments couple MSME formalization programmers with productivity, financing, and digital-marketing support, and that future research employ quarterly or sectoral panel data to address the small-sample limitation

Copyrights © 2024






Journal Info

Abbrev

ekspektasy

Publisher

Subject

Economics, Econometrics & Finance Education Languange, Linguistic, Communication & Media Library & Information Science Social Sciences

Description

JOURNAL EKSPEKTASy contains research results and thoughts about the economy, especially Islamic economics. The main focuses of include Economic Concepts and Thoughts, Sharia Economic Concepts, Islamic Financial Institutions, Accounting, Finance, Islamic Banking and Management, Public Sector ...