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efi@lpem-feui.org
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Institute for Economic and Social Research (LPEM-FEUI) Jl. Salemba Raya No. 4, Jakarta, Indonesia, 10430
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INDONESIA
Economic and Finance in Indonesia
Published by Universitas Indonesia
ISSN : 0126155X     EISSN : 24429260     DOI : -
Core Subject : Economy, Education,
Aims & Scope EFI mainly covers original idea related to the Economics and Finance in Indonesia. Published articles can be either theoretical, empirical, or in between of those two polar variants. The journal covers specific areas, including but not limited to: Agricultural Economics Capital Market Demography Development Economics Economy in Crisis Economy of Rural Areas Education Economics Energy Economics Environmental and Natural Resources Economics Financial Sector Health Economics History of Economic Thoughts Industrial Economics Institutional Aspect of Economy International Economics Investment Labor Economics Maritime Economics Methodology of Economics Monetary Economics Political Economics Poverty Economics Public Policy Public Sector Economics Regional Economics Urban Economics
Articles 128 Documents
The Impact of the U.S.-China Tariff War on Trade and Investment in Developing Countries in Disrupted Global Value Chains Riefky, Teuku; Sabrina, Syahda; Revindo, Mohamad Dian
Economics and Finance in Indonesia Vol. 71, No. 1
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Abstract

As the world is more open and more integrated than ever, the trade war between the two largest economies, the United States (U.S.) and China, has significant and unexpected implications for multinational companies within global value chains. Since both markets are closed to each other due to the imposition of higher import tariffs, businesses have to shift their trade activities to alternative countries. Employing historical data, existing country-level data from the Global Trade Analysis Project on Value-Added (GTAP-VA), and tariffs imposed during the U.S.-China trade war, this study comprehensively examines the impacts of the trade war on global value chains, with a particular emphasis on developing countries. This study discovers that the increase in US import tariffs has a positive and statistically significant effect on the total exports of developing countries. Higher gross exports will generate higher domestic value-added (DVA) exports from developing countries, particularly those in ASEAN, as several countries compensate for reduced exports from China to the U.S. Furthermore, certain sectors or commodities are projected to benefit from the trade war, while others may experience adverse effects. The primary contributors to the increase in DVA exports are agricultural, textile, and leather products. On the other hand, high-technology manufacturing exports are likely to suffer due to the low comparative advantage of developing countries in these types of products.
Pension Funds for Housing Development in Indonesia: Challenges and Strategies Soseco, Thomas; Kresnowati, Anggari Marya; Rini, Ayu Dwidyah
Economics and Finance in Indonesia Vol. 71, No. 1
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Abstract

Housing infrastructure is necessary to improve the quality of life of the community, yet a recent assessment of housing infrastructure development in Indonesia highlights a low level of performance. Therefore, actions are needed to stimulate it through pension funds, which remain minimally utilized for direct investment in the housing sector. This research investigates the potential and challenges of using pension funds for housing investment in Indonesia, employing Input Output (IO) Analysis with data from Statistics Indonesia (BPS). The findings reveal a significant gap between the potential and realized pension fund investments, indicating the substantial capacity of pension funds to be directed towards investment in the housing sector. Two strategies are recommended to address this. First, maximizing pension fund revenue, mainly among population groups underserved by pension funds, such as micro, small, and medium business owners and informal workers. Second, reorienting policies to enhance investment opportunities in the housing sector while overcoming future challenges.
The Jokowi Effect on the Victory of Prabowo: Do People Vote for Continuity? Putra, Cakra Yudi; Febriani, Dyah Ayu; Nugroho, Andri Tantyo Cahyo; Dartanto, Teguh
Economics and Finance in Indonesia Vol. 71, No. 1
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Abstract

The 2024 Indonesian presidential election marked a striking realignment as Prabowo Subianto—a former opposition leader—secured victory with the tacit endorsement of outgoing President Joko Widodo (Jokowi). This study investigates how the enduring popularity and policy achievements of Jokowi shaped voter preferences in favor of Prabowo, effectively positioning the election as a referendum on political continuity. Building on theories of economic voting and retrospective performance evaluation, the analysis explores the impact of district-level economic indicators, social media penetration, ideological orientation, social assistance distribution, and sociocultural characteristics on electoral outcomes. Employing Ordinary Least Squares (OLS) regression on data from 481 administrative regions, the study uncovers a robust positive relationship between the 2019 vote share for Jokowi and the 2024 performance of Prabowo. These findings highlight the potency of pocketbook voting—voter assessments of their economic welfare—in sustaining incumbent influence and advancing the theory of economic voting by demonstrating how the legacy of a sitting president can persist through perceptions of economic stewardship.
Non-Tariff Measures on Indonesian Tea Products: Do SPS and TBT Impede or Promote the Export? Putro, Fikri Aldi Dwi; Widyastutik, Widyastutik; Hidayat, Nia Kurniawati
Economics and Finance in Indonesia Vol. 71, No. 1
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Abstract

Previous studies highlight the heterogeneous effects of Non-Tariff Measures (NTMs) on international trade. This study identifies the enforcement of NTMs and examines the effects on the export performance of Indonesian tea products. This study employed an inventory (coverage ratio) approach and panel regression with the Poisson-Pseudo Maximum Likelihood (PPML) method. The results indicate that 31 out of 36 analyzed destination countries enforce NTMs, with Vietnam imposing the most prevalent ones. Furthermore, SPS measures substantially promote the export of Indonesian tea products, whereas TBT measures show no significant effect. Therefore, the government needs to provide incentives and harmonize the national Voluntary Sustainability Standards (VSS) scheme and other national standards to comply with NTMs imposed by destination countries.
The Importance of the Safety Net Program for Informal Workers’ Food Security Amid the COVID-19 Pandemic in Indonesia Umaroh, Rodhiah; Amirusholihin, Amirusholihin; Yuliawati, Yuliawati
Economics and Finance in Indonesia Vol. 71, No. 2
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Abstract

This study examines the effects of social safety-net programs on food security among vulnerable groups, focusing on households with informal workers. Utilizing data from the High-Frequency Monitoring of the COVID-19 Impacts 2020 (HiFy) and estimates with the Longitudinal Propensity Score Matching (LPSM) method, the findings reveal that cash and food assistance significantly reduce food insecurity among informal workers’ households. The households receiving these safety net programs experienced an 8–11% lower probability of food insecurity compared to non-recipients, as indicated by the Average Treatment Effect on the Treated (ATT) value. The study highlights the need for continued investment in inclusive and effective safety net programs to safeguard vulnerable populations, particularly in developing countries with significant informal labor forces.
Tracking Impact: Leveraging Pre-existing Monitoring Tools for Assessing Indonesia’s Free Nutritious Meal (Makan Bergizi Gratis) Programme Natih, Putu Geniki Lavinia
Economics and Finance in Indonesia Vol. 71, No. 2
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Abstract

Indonesia’s Makan Bergizi Gratis (MBG) programme is among the largest school feeding initiatives globally, yet its rapid scale-up has outpaced the development of a robust monitoring, evaluation, and learning (MEL) framework capable of assessing welfare-relevant outcomes. This paper examines whether pre-existing national survey instruments can be leveraged to strengthen outcome monitoring in the absence of MBG-specific microdata. Focusing on the Food Insecurity Experience Scale (FIES) collected through Indonesia’s National Socio-Economic Survey (Susenas), the study first situates experiential food insecurity within Indonesia’s broader food security landscape. It then applies a propensity score matching framework using participation in the Bantuan Pangan Non-Tunai (BPNT) programme as an illustrative case to assess the responsiveness of FIES to food assistance exposure. The results demonstrate that experiential food insecurity captures dimensions of vulnerability that are not fully reflected in consumption-based indicators. The measure also responds to food and dietary access related interventions. The paper argues that integrating FIES into MBG’s MEL architecture offers a feasible, scalable, and analytically robust approach to monitoring short- to medium-term programme outcomes and supports adaptive implementation of MBG.
Firms Heterogeneity in Indonesia’s Manufacturing and Services Sectors Siregar, Rizki Nauli
Economics and Finance in Indonesia Vol. 71, No. 2
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Abstract

Firm heterogeneity is the building block of modern trade theories. One of its important implications is that comparative advantage is driven by firm productivity, rather than sector differences across countries. Despite the prevalence of this framework, there has not been any systematic documentation on firm heterogeneity in Indonesia’s man ufacturing and services firms. Using the World Bank Enterprise Survey (WBES) data for Indonesia in 2015 and 2023, we confirm that there is firm heterogeneity in the form of size and productivity dispersion in both of the economy’s manufacturing and services sectors. We also find no strong association between size and average product of labor, yet we caution that the finding may be formed by the sample construction in the database. We also show the existence of globalization premia as well as the dynamics of the premia in the manufacturing and services firms.
The Moderating Effect of Income Inequality on the Income–Emissions Relationship in G20 Countries Fadilah, Zahra Rizky; Budiasih, Budiasih
Economics and Finance in Indonesia Vol. 71, No. 2
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Abstract

This study analyzes the moderating effect of income inequality on the income–emissions relationship in the environmental Kuznets curve (EKC) framework. Findings indicate that the relationship is inverted U-shaped in middle-income G20 countries, but monotonically increasing in high-income G20 countries. Interestingly, income inequality moderates this relationship only in the latter group. These findings suggest that middle-income G20 countries should focus on raising income per capita to mitigate environmental degradation, while their high-income counterparts need to prioritize reducing income inequality to effectively decouple income from emissions.

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