scholarly journals DETERMINAN TRANSAKSI NONTUNAI DI INDONESIA DENGAN PENDEKATAN ERROR CORRECTION MECHANISM (ECM) MODEL

2019 ◽  
Vol 3 (1) ◽  
pp. 62-77 ◽  
Author(s):  
Zulfa Nur Fajri Ramadhani ◽  
Siskarossa Ika Oktora ◽  
Indonesian Journal of Statistics and Its Applications IJSA
Keyword(s):  
Error Correction ◽  
Money Supply ◽  
Secondary Data ◽  
Long Run ◽  
Error Correction Mechanism ◽  
Short Run ◽  
Cash Transaction ◽  
Monthly Period ◽  
Private Savings ◽  
Positive Effect

Consumption is an activity that must be done by everyone. In order to consume something, a transaction is needed to get the goods or services desired. One kind of transaction that is used by many people nowadays is non-cash transaction. Since Bank Indonesia established Gerakan Nasional Non Tunai (GNNT) in August 2014, the value of non-cash transactions exceeds the value of cash transactions. It happenned because people prefer non-cash to cash transaction which is easier, safer, more practical, and more economical. Besides, an increase in non-cash transactions can also be influenced by other factors. Therefore, a study is conducted to analyze the determinants of non-cash transactions from the macro side by using Error Correction Mechanism (ECM). The data used in this study are secondary data from Bank Indonesia and Badan Pusat Statistik with monthly period from January 2010 until December 2017. The results showed that in the long run, private savings and BI rate have positive effect on non-cash transactions. In the short run, private savings and money supply have positive effect on non-cash transactions. While inflation does not affect non-cash transactions, both in the short and long run.

scholarly journals MONETARY POLICY AND TELECOMMUNICATION OUTPUT IN NIGERIA

2020 ◽  
Vol 3 (2) ◽  
pp. 62-73
Author(s):  
John Abiodun Akinde ◽  
Elijah Oludayo
Keyword(s):  
Monetary Policy ◽  
Money Supply ◽  
Negative Relationship ◽  
Negative Influence ◽  
Favourable Effect ◽  
Data Series ◽  
Long Run ◽  
Integration Test ◽  
Short Run ◽  
Positive Effect

Different policies impact on the growth of the telecommunication sector in Nigeria. One of these policies which influence the expansion or contraction of the telecommunication output is monetary policy. To this end, this research examined the effect of monetary policy on telecommunication output in Nigeria. For the purpose of analysis, time series secondary data were sourced from Central Bank of Nigeria (CBN) statistical bulletin covering the periods1986 to 2018. Autoregressive Distributed Lag (ARDL) technique was employed after examining the stationarity of the data series using Augmented Dickey-Fuller technique. The bound co-integration test revealed that there is long run equilibrium between the monetary policy variables employed and telecommunication output. The ARDL result revealed that money supply had significant and positive effect on telecommunication output in the short and long run; liquidity ratio produced an insignificant and negative relationship with telecommunication output in the short run and insignificant positive effect in the long run; exchange rate had insignificant negative effect in the short run and a significant positive effect on telecommunication output in the long run; consumer price index had significant negative influence on telecommunication outputboth in the short run and long run. The study concluded that monetary policy stimulates telecommunication output in Nigeria. Thus, it was recommended that the monetary authority should pursue an expansionary monetary policy to sustain the positive influence of money supply on telecommunication output in Nigeria while rolling out policy to reduce the liquidity ratio of banks in the short run but increase it in the long run so that the long term favourable effect of liquidity ratio can be felt on telecommunication output.  

scholarly journals INFLASI DARI SUDUT PANDANG MONETER DAN FISKAL (STUDI KASUS SUMATERA BARAT)

2019 ◽  
Vol 1 (1) ◽  
pp. 131
Author(s):  
Zul Azhar ◽  
Alpon Satrianto ◽  
Nofitasari Nofitasari
Keyword(s):  
Interest Rate ◽  
Money Supply ◽  
Government Spending ◽  
Descriptive Research ◽  
Distributed Lag ◽  
Long Run ◽  
Negative Effect ◽  
Short Run ◽  
The Interest Rate ◽  
Positive Effect

This study aims to analyze the effect of money supply M2, interest rate, government spending and local tax on the inflation in West Sumatera. This type of research is descriptive research and secondary datain the form of time-series from quartely 1 2007 to 2017 quartely 4 using the method of Autoregresive Distributed Lag analysis. The results of this study indicate that money supply in the long run have a significant and positive effect on inflation West Sumatera. In the short run  and long run the interest rate has a significant and positive effect on inflation in West Sumatera. Government spending in the Long run has a significant and negative effect on inflation in West Sumatera. Based on the result of this study can be concluded that there is inflation in West Sumatera is monetery of phenomenon in the long run. 

scholarly journals Analisis Kesinambungan Fiskal Indonesia Pasca Krisis Ekonomi

2019 ◽  
Vol 17 (2) ◽  
pp. 59-70
Author(s):  
Muhammad Basorudin
Keyword(s):  
Gross Domestic Product ◽  
Error Correction ◽  
Early Warning ◽  
Fiscal Sustainability ◽  
General Description ◽  
Debt Ratio ◽  
Upward Trend ◽  
Long Run ◽  
Error Correction Mechanism ◽  
Short Run

The debt to Gross Domestic Product (GDP) ratio is one of the indicators used to measure fiscal sustainability in Indonesia. From 2010-2017 on a quarterly basis, the debt to GDP ratio of Indonesia contributed to an upward trend. The purpose of this research is to get a general description of the debt ratio to GDP and analyze the factors that affect the ratio of debt to GDP simultaneously and partially to be used as an early warning for the fiscal sustainability of Indonesia. The model used in this research is Error Correction Mechanism (ECM).  The results obtained from this research is the Indonesia’s debt to GDP ratio is influenced by the debt to GDP ratio previous quarter. The influence given to the current quarterly debt ratio in the short run is greater than long run.

scholarly journals Testing the Validity of the Long Run Neutrality of Money in Nigeria

2021 ◽  
Vol 21 (2) ◽  
pp. 148-167
Author(s):  
Ephraim Ugwu ◽  
Christopher Ehinomen ◽  
Philip Nwosa ◽  
Olubunmi Efuntade
Keyword(s):  
Error Correction ◽  
Money Supply ◽  
Phillips Curve ◽  
Correction Term ◽  
Negative Sign ◽  
Fine Tuning ◽  
Annual Data ◽  
Long Run ◽  
Effect Model ◽  
Short Run

Abstract Research background: There is no consensus among scholars on the interaction effect between money supply, price, and wages despite various studies conducted to that effect. Purpose: This study investigates whether the neutrality of money assumption holds in the long run in Nigeria, using annual data from 1970 to 2018. Research methodology: The study utilized the Johansen cointegration test and the Vector Error Correction (VECM) approach for estimation. Results: The results from the Phillips curve model contradict the classical school of economics assumption that money is neutral in the long run. This implies that in the Nigerian economy, money is not neutral in the long run. The long run Fishers’ effect model shows that the coefficient of LOG (CPI) exhibits a negative sign and is statistically significant at a 5% significant level, thus contradicting the hypothesis which states that a one percent increase in consumer prices will lead to an increase in the rate of interest by one percent. The coefficient of nominal money supply indicates a negative sign and insignificant statistically on the interest rate. The Short-run estimated results showed that the coefficient of the error correction term ECM (–1) indicates a negative sign and is significant statistically in the Fishers’ effect model. The result shows the actual and equilibrium values are corrected with adjustment speeds equal to 31% yearly. Novelty: The study recommends that the Central Bank of Nigeria should ensure an effective implementation of monetary targeting measures in fine-tuning the economy and curbing inflationary pressures.

scholarly journals Do Diaspora Remittances Guarantee Food Security in Nigeria?

2021 ◽  
pp. 36-53
Author(s):  
Onime, Bright Enakhe ◽  
E. Kalu, Ijeoma
Keyword(s):  
Food Security ◽  
Error Correction ◽  
Correction Term ◽  
Secondary Data ◽  
Vector Error Correction ◽  
Current Period ◽  
Vector Error ◽  
Long Run ◽  
Short Run ◽  
Security Challenge

The burgeoning remittances into Nigeria and their effect on the economy have received renewed attention in recent times. Literature has suggested the existence of a relationship between remittances and food security. The extent to which this is true for Nigeria is uncertain. Using Vector Error Correction Model (VECM), this study examined the link between remittances and food security using secondary data for the period 1980 to 2018. Findings revealed a robust long and short-run relationship between remittances and food security. In the short-run, a positive and significant relationship was found between remittances and food security in the current period such that a 1 per cent increase in remittances was associated with a 5.08 per cent improvement in food security. In the long-run, a cointegrated relationship was observed as the error correction term depicting this relationship was well-behaved, properly signed and significant indicating that any previous period deviation in long-run equilibrium is corrected in the current period at an adjustment speed of 28.8 per cent. In addition, the Granger test suggests a unidirectional causality running from remittances to food security such that past values of remittances determined food security during the period investigated. Consequent to the findings, the study recommended with a caveat, the design and proper implementation of a diaspora and remittances policy to cater for the welfare of Nigerians in the diaspora to improve remittance receipts and by implication, food security. However, since remittances alone cannot guarantee food security in Nigeria, this study further recommends a holistic and multidimensional approach to address the food security challenge and close the food deficit gap.

scholarly journals Monetary Policy and Long Run Economic Growth in Nigeria: An Application of the Vector Error Correction Mechanism

2021 ◽  
Vol 2 (2) ◽  
pp. 71-83
Author(s):  
Vincent Iorja GISAOR
Keyword(s):  
Economic Growth ◽  
Monetary Policy ◽  
Error Correction ◽  
Money Supply ◽  
Granger Causality Test ◽  
Causality Test ◽  
Vector Error Correction ◽  
Vector Error ◽  
Long Run ◽  
Error Correction Mechanism

The inability of most developing economies to use monetary policy to engender real economic growth in their countries prompted the researchers to empirically assess the impact of monetary policy on economic growth in Nigeria between 1980 and 2014. The study employed an econometrics approach making use of the ADF unit root test, Johansen cointegration, Vector error correction model, Pairwise granger causality test and variance decomposition. The Vector Error Correction Mechanism result shows a positive short and long run relationship between both narrow money supply and broad money supply and economic growth in Nigeria with model strength of 75%. The Pairwise granger causality test shows a bi-directional causality between broad money supply and economic growth in Nigeria and was statistically significant at 5% level of confidence. Recommendations were for the government to use her contractionary monetary efforts and implement relevant policies to curtail the inverse effect of the persistent variation in the value of exchange rate, price level and interest rate in Nigeria and adequate regulation of the quantity of money in circulation to avoid hyperinflation and other unpredictable monetary volatilities.

scholarly journals Price Dynamics of Domestic and International Wheat Markets: A Vector Error Correction Mechanism (VECM) Approach

2021 ◽  
pp. 15-20
Author(s):  
A. G. Sabhaya ◽  
S. M. Upadhyay ◽  
P. R. Vekariya ◽  
B. Swaminathan
Keyword(s):  
United States ◽  
Error Correction ◽  
Market Integration ◽  
Vector Error Correction ◽  
Vector Error ◽  
Integration Approach ◽  
Long Run ◽  
Error Correction Mechanism ◽  
Production And Distribution ◽  
Short Run

Market integration in agricultural commodities is vital for both developed and developing countries alike. If prices are not dreamily transmitted, then it may lead to biases in production and distribution. The strength of interdependence among markets and the speed in which the changes are passed through determine the degree of integration and the global efficiency of markets. This study examines the long-run and short-run integration of domestic and international wheat markets using Co-integration approach within the framework of Vector Error Correction Mechanism (VECM). A sample of two domestic wheat markets comprising two from the national wheat markets of Mathura (UP) and Khanna (Punjab) were selected along with two international wheat markets comprising from United States and Argentina. Analysis was carried out using the monthly price data between January 2003 and Dec 2019. Findings discovered that the prices became stationary merely upon first differencing. The presence of integration was confirmed among markets involving that there is price conduction.

scholarly journals KETERKAITAN INDIKATOR MONETER SYARIAH TERHADAP PENDAPATAN DOMESTIK BRUTO

2012 ◽  
Vol 1 (1) ◽  
Author(s):  
Yunie Fitriani ◽  
Roikhan Mochamad Aziz ◽  
Fitri Amalia
Keyword(s):  
Gross Domestic Product ◽  
Error Correction ◽  
Money Supply ◽  
Islamic Banking ◽  
Short Term ◽  
Correction Model ◽  
Independent Variables ◽  
Long Run ◽  
Short Run

The purpose of this research is to analyze in the short term and long term between the four independent variables including: the financing of Islamic banking, the Jakarta Islamic Index (JII), the Islamic Bank Indonesia certificates (SBIS), and the money supply (JUB) to gross domestic product (GDP). This research uses the test to notice any indications of Granger was awarded a long-term relationship and Error Correction Model to see the existence of a short-term relationship. The result shows that in the short-run only SBIS that have a short-run relationship to GDP. In the long-run all the independent variables can explain the long-run relationship to GDPDOI: 10.15408/sjie.v1i1.2595 

scholarly journals The Service Sector-Led Growth Relationship: The Case of Nigeria

2021 ◽  
pp. 90-111
Author(s):  
Ubong Edem Effiong ◽  
Joel Isaac Okon
Keyword(s):  
Economic Growth ◽  
Gross Domestic Product ◽  
Error Correction ◽  
Service Sector ◽  
Domestic Product ◽  
Long Run ◽  
Error Correction Mechanism ◽  
Short Run ◽  
Bounds Test ◽  
The Impact

This paper examined the impact of the service sector on economic growth of Nigeria. The study covers the period 1981 to 2019 and data were obtained from the Central Bank of Nigeria statistical bulletin. The Augmented Dickey-Fuller unit root, Granger Causality test, Vector Autoregressive (VAR) approach, Bounds test for cointegration, and vector error correction mechanism were utilized in analysing the data. Findings of the study revealed that a bidirectional causality exist between service sector and economic growth of Nigeria. Meanwhile, the VAR result presented an evidence of weak exogeneity of the service sector in predicting economic growth. However, both broad money supply and total government expenditure exerted a significant impact on economic growth. From the impulse response function, it was discovered that economic growth responded negatively to shocks in service sector output both in the short run and in the long run; while the variance decomposition indicated that gross domestic product (a proxy for economic growth) is strongly endogenous in predicting itself in the short run while such diminishes in the long run. The Bounds test for cointegration revealed evidence of long run equilibrium relationship and the error correction mechanism revealed that 88.30% of the short run disequilibrium in the gross domestic product are corrected annually. Meanwhile, it was discovered that professional, scientific and technical services is the major contributor to economic growth as captured by its short run and long run elasticity coefficients of 0.5936 and 0.9455 respectively. The paper recommended the need for stimulating industrialization as this is the major pathway through which the service sector can positively impact economic growth.

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