The cyclicality of government expenditure in developing country: the case of Indonesia
This paper analyzes the cyclicality and the relationship between government expenditure and output of Indonesia, 1999-2012 using Johansen co-integration test and the error correction model. The results confirm that in the short-run the government expenditure reveals counter-cyclical but pro-cyclical...
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| Format: | Article |
| Language: | English |
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Universitas Islam Indonesia
2014-04-01
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| Series: | Economic Journal of Emerging Markets |
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| Online Access: | https://journal.uii.ac.id/JEP/article/view/3864 |
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| _version_ | 1849234067428474880 |
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| author | Haryo Kuncoro |
| author_facet | Haryo Kuncoro |
| author_sort | Haryo Kuncoro |
| collection | DOAJ |
| description | This paper analyzes the cyclicality and the relationship between government expenditure and output of Indonesia, 1999-2012 using Johansen co-integration test and the error correction model. The results confirm that in the short-run the government expenditure reveals counter-cyclical but pro-cyclical in the longrun. Output and government expenditure are co-integrated and it implies the existence of long-term relationship. The value of short-run elasticity coefficient for government expenditure is relatively high. In contrast, the long-run elasticity coefficient is lower and statistically greater than unity confirming the voracity hypothesis. Furthermore, there is no significant difference of government spending in good and bad times. |
| format | Article |
| id | doaj-art-0fb7d0cbb52c4802af6bed8f5cd0439d |
| institution | Kabale University |
| issn | 2086-3128 2502-180X |
| language | English |
| publishDate | 2014-04-01 |
| publisher | Universitas Islam Indonesia |
| record_format | Article |
| series | Economic Journal of Emerging Markets |
| spelling | doaj-art-0fb7d0cbb52c4802af6bed8f5cd0439d2025-08-20T04:03:17ZengUniversitas Islam IndonesiaEconomic Journal of Emerging Markets2086-31282502-180X2014-04-0161The cyclicality of government expenditure in developing country: the case of IndonesiaHaryo Kuncoro0Faculty of Economics, State University of JakartaThis paper analyzes the cyclicality and the relationship between government expenditure and output of Indonesia, 1999-2012 using Johansen co-integration test and the error correction model. The results confirm that in the short-run the government expenditure reveals counter-cyclical but pro-cyclical in the longrun. Output and government expenditure are co-integrated and it implies the existence of long-term relationship. The value of short-run elasticity coefficient for government expenditure is relatively high. In contrast, the long-run elasticity coefficient is lower and statistically greater than unity confirming the voracity hypothesis. Furthermore, there is no significant difference of government spending in good and bad times.https://journal.uii.ac.id/JEP/article/view/3864GovernmentExpenditureCyclicalityVoracityElasticity |
| spellingShingle | Haryo Kuncoro The cyclicality of government expenditure in developing country: the case of Indonesia Economic Journal of Emerging Markets Government Expenditure Cyclicality Voracity Elasticity |
| title | The cyclicality of government expenditure in developing country: the case of Indonesia |
| title_full | The cyclicality of government expenditure in developing country: the case of Indonesia |
| title_fullStr | The cyclicality of government expenditure in developing country: the case of Indonesia |
| title_full_unstemmed | The cyclicality of government expenditure in developing country: the case of Indonesia |
| title_short | The cyclicality of government expenditure in developing country: the case of Indonesia |
| title_sort | cyclicality of government expenditure in developing country the case of indonesia |
| topic | Government Expenditure Cyclicality Voracity Elasticity |
| url | https://journal.uii.ac.id/JEP/article/view/3864 |
| work_keys_str_mv | AT haryokuncoro thecyclicalityofgovernmentexpenditureindevelopingcountrythecaseofindonesia AT haryokuncoro cyclicalityofgovernmentexpenditureindevelopingcountrythecaseofindonesia |