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DYNAMIC CAUSALITIES BETWEEN WORLD OIL PRICE AND INDONESIA’S COCOA MARKET: EVIDENCE FROM THE 2008 GLOBAL FINANCIAL CRISIS AND THE 2011 EUROPEAN DEBT CRISIS

Mukhlis MUKHLIS

PhD Scholar in Economics, Faculty of Economics and Business, Universitas Syiah Kuala, Lecturer, Universitas Almuslim, Indonesia

mukhlis.umuslim@gmail.com

Raja MASBAR

Professor in Economics, Faculty of Economics and Business, Universitas Syiah Kuala, Indonesia

raja.masbar53@gmail.com

Sofyan SYAHNUR

Senior Lecturer in Economics, Faculty of Economics Business, Universitas Syiah Kuala, Indonesia

kabari_sofyan@unsyiah.ac.id

M. Shabri Abd. MAJID

Senior Lecturer in Economics, Faculty of Economics Business, Universitas Syiah Kuala, Indonesia, Corresponding author

mshabri@unsyiah.ac.id

Abstract

This study examines and analyzes the short- and long-run dynamic causal relationship between the prices of Indonesian and world cocoa beans during the 2008 global financial crisis and the 2011 European debt crisis. Time series analysis consisting of cointegration, Vector Error Correction Model (VECM) and Granger causality are used to test long-run equilibrium, short- and long-run relationships, and dynamic causalities between the Indonesian cocoa and world cooa prices. The study found a long-run equilibrium between Indonesian cocoa price, world cocoa price, exchange rate, and world oil price. The Indonesian and world cocoa markets have a mutually influential relationship. However, an inefficient transmission of corrective adjustments in the Indonesian cocoa prices was documented over the study period. The exchange rate consistently affected Indonesian cocoa prices, while fluctuations in world oil prices were independent to domestic and world cocoa markets over the study period. Overall, the study documented a long-run equilibrium between Indonesian and global cocoa markets at the different level of speed of adjustment of the world cocoa price towards long-run equilibrium between the two economic crises. The Indonesian government needs to enhance international trade cooperation and pricing policy harmonization among cocoa producing- and importing-countries.

Keywords: Cocoa price, Exchange rate, Oil price, World cocoa market, Economic crisis

JEL classification: C01, C23, O13.

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INFLATION AND UNEMPLOYMENT IN SOUTHEAST ASIAN COUNTRIES: A PANEL GMM APPLICATION ON PHILLIPS CURVE

ALIASUDDIN

Associate Professor at the Department of Economics, Faculty of Economics and Business, Universitas Syiah Kuala, Banda Aceh, Indonesia

aliasuddin@unsyiah.ac.id

Sofyan SYAHNUR

Associate Professor at the Department of Economics, Faculty of Economics and Business,Universitas Syiah Kuala, Banda Aceh, Indonesia

kabari_sofyan@unsyiah.ac.id

MALIA

Graduate Student at the Department of Economics, Faculty of Economics and Business, Universitas Syiah Kuala, Banda Aceh, Indonesia

malia1980@mhs.unsyiah.ac.id

Abstract

This study aims to analyze the relationship between inflation and unemployment in 10 Southeast Asian from 1996 to 2016 using 210 data samples. The estimation results, using the GMM panel method, showed that the use of Instrument Variables (IV) is valid for the model and the results show a negative and significant relationship between inflation and unemployment. The optimal value of inflation and unemployment for the Southeast Asian Region were found to be 4 percent and 8 percent respectively. This means that a trade-off has taken place. Thus, the existence of the Phillips Curve in Southeast Asian countries during the period of 1996-2016 can be proven. In accordance with the Phillips Curve review, if the trade-off occurs, the government cannot resolve both problems simultaneously. In other words, policy makers must be able to choose the problem to be addressed first, either by implementing monetary policy, fiscal policy or both, so that economic stability and public welfare are maintained.

Keywords: Inflation, Unemployment, Phillips Curve, Panel GMM, Southeast Asia.

JEL classification: E24, E31, C23, J01

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EXPLORING DYNAMICS BETWEEN THE SOCIOECONOMIC SECTORS FROM NORTH OF PORTUGAL AND GALICIA

Vítor João Pereira Domingues MARTINHO

Coordinator Professor with Habilitation, Agricultural School (ESAV) and CERNAS-IPV Research Centre, Polytechnic Institute of Viseu (IPV), Portugal; Centre for Transdisciplinary Development Studies (CETRAD), University of Trás-os-Montes and Alto Douro (UTAD), Portugal

vdmartinho@esav.ipv.pt

Jesyca Salgado BARANDELA

Facultad de Ciencias Empresariales y Turismo, Universidad de Vigo, España

j.salgado@uvigo.es

Abstract

Cultural and institutional differences could difficult to strengthen the relationships between regions from diverse countries. This situation is a little true for the cooperation among the North of Portugal and Galicia, but present and recent past show that there is promising news for the future. In this scenario, the main objective of this work is to identify the dynamics between the economic sectors of these two regions, stressing the advantages from a closer cooperation. To achieve these objectives, data from the Eurostat for the Portuguese and Spanish NUTS 3 were considered. These data were explored through panel data models from the Keynesian and Neoclassical models, allowing for spatial effects. The main findings stress that there are interesting catching-up effects between the North of Portugal and Galicia that could be explored deeper, namely between the manufacturing industry.

Keywords: Verdoorn law, Convergence Theory, Panel data.

JEL classification: C23, E12, E13, O47, R11

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