International Journal of Science and Society (IJSOC)
Vol 8 No 2 (2026): International Journal of Science and Society (IJSOC)

The Moderating Role of Institutional Quality on the Effect of Household Consumption and Government Expenditure on Economic Growth in Indonesia

Fajar Ardiansyah (UIN Mahmud Yunus Batusangkar, Indonesia)
Kefvin Melwani (UIN Mahmud Yunus Batusangkar, Indonesia)
Melly Firdawinata (Universitas Ibnu Sina, Batam, Indonesia)



Article Info

Publish Date
16 Jul 2026

Abstract

The magnitude of household consumption and government expenditure does not guarantee accelerated economic growth without being supported by sound institutional quality, particularly corruption control, which remains a major challenge in Indonesia's governance. This study aims to analyze the moderating role of institutional quality in the effect of household consumption and government expenditure on economic growth in Indonesia. This study employs a quantitative explanatory approach using time series data for the period 2006–2025, obtained from the official World Bank website. The analysis techniques used are multiple regression and Moderated Regression Analysis (MRA). The results show that household consumption (β = 3.489; sig = 0.017) and government expenditure (β = 1.379; sig = 0.015) have a positive and significant effect on economic growth. Institutional quality is able to moderate and strengthen the effect of household consumption (β = 9.100; sig = 0.018) and government expenditure (β = 1.890; sig = 0.013) on economic growth, with an R² of 0.842. These findings confirm that corruption control and improved governance are key to optimizing the effectiveness of fiscal policy and domestic consumption on sustainable economic growth.

Copyrights © 2026






Journal Info

Abbrev

ijsoc

Publisher

Subject

Materials Science & Nanotechnology Social Sciences

Description

International Journal of Science and Society (IJSOC) is open access and peer-reviewed journal with e-ISSN (2715-8780), IJSOC is an international journal devoted to the study of science and technology in a social context. It focuses on the way in which advances in science and technology influence ...