Journal of Indonesian Applied Economics https://jiae.ub.ac.id/index.php/jiae <p>Journal of Indonesian Applied Economics (JIAE) is an online journal sponsored by the Faculty of Economics and Bussiness, Universitas Brawijaya. The purpose of this journal is to enhance the study of economic issues on all aspects of applied economics and finance. The referred Journal emphasizes quality, tests of theories, policy implications, and clarity. For further information and submission process, don't hesitate to <a href="https://jiae.ub.ac.id/index.php/jiae/about/contact" target="_self">contact us</a>.</p> <p>Online ISSN <a href="https://portal.issn.org/resource/ISSN/2541-5395">2541-5395</a> | Print ISSN <a href="https://portal.issn.org/resource/ISSN-L/1907-7947">1907-7947</a></p> en-US jiae.feb@ub.ac.id (Silvi Asna Prestianawati) fawwaz22muhammad@gmail.com (Muhammad Fawwaz) Thu, 29 Feb 2024 00:00:00 +0000 OJS 3.3.0.13 http://blogs.law.harvard.edu/tech/rss 60 Income Distribution of Informal Sector Labor in Indonesia 2022 https://jiae.ub.ac.id/index.php/jiae/article/view/1279 <p><strong>Purpose</strong></p> <p>This research aims to look at the description of the characteristics and factors that influence the categories of income levels under class (vulnerable and poor) and aspiring middle class in informal sector labor in Indonesia 2022.</p> <p><strong>Design/methodology/approach</strong></p> <p>The dataset from raw data of the National Labor Survey (SAKERNAS) in February 2022 collected by Badan Pusat Statistik (BPS). This research used the ordinal logistic regression, model of partial proportional odds (PPOM). The dependent variable used is the income level category based on the classification determined by World Bank.</p> <p><strong>Findings</strong></p> <p>This research finds that 58 percent of the population are informal labor. The results of the analysis show that the level of education, job training, work experience, type of work, age, gender, marital status, working hours, and residential area classification have a significant effect on income level categories.</p> <p><strong>Research limitations/implications</strong></p> <p>This research only includes sample of informal sector labor who have income and based on the main job status classification from BPS.</p> <p><strong>Originality/value</strong></p> <p>In this research, income of informal sector labor are categorized based on classification determined by World Bank. Then there has not been much research on the characteristics of informal sector labor and what influences the level of their income category.</p> Bellia Mega Sari, Sugiarto Copyright (c) 2024 Journal of Indonesian Applied Economics https://creativecommons.org/licenses/by-nc/4.0 https://jiae.ub.ac.id/index.php/jiae/article/view/1279 Thu, 29 Feb 2024 00:00:00 +0000 Analyzing the Effects of Interest Rates, Inflation, and Exchange Rates on Stock Market Performance: A Comparative Study Of Indonesia and Japan https://jiae.ub.ac.id/index.php/jiae/article/view/1330 <p><strong>Purpose</strong></p> <p>This study examines the influence of macroeconomic variables on stock market performance in Indonesia and Japan from 2013 to 2023. Drawing upon the Efficient Market Hypothesis (EMH), we investigate how key factors such as interest rates, inflation, exchange rates, and economic events impact stock returns.</p> <p><strong>Design/methodology/approach</strong></p> <p>We examine the connections between these characteristics and stock market performance in two different markets using regression analysis and EMH as the theoretical framework. In order to find patterns and trends, we analyze data spanning a decade.</p> <p><strong>Findings</strong></p> <p>Interest rates strongly affect Indonesian stocks due to their influence on investor sentiment. In Japan, trade agreements have a significant positive impact on stock returns. However, stock returns in both countries are weakly connected to inflation, currency rates, and other economic and political factors. The global economy remains a key external factor for both markets.</p> <p><strong>Research limitations/implications</strong></p> <p>This study has some restrictions, such as data limitations and EMH framework-related presumptions. In the future, research may focus on longer-term effects, behavioral aspects, and sector-specific analysis to further our comprehension of these intricate interactions.</p> <p><strong>Originality/value</strong></p> <p>This research advances our understanding of market behavior under various economic conditions by analyzing the interaction of macroeconomic variables and stock market dynamics in two distinct economies.</p> Alith Jacob Majok, David Kaluge, Dias Satria Copyright (c) 2024 Journal of Indonesian Applied Economics https://creativecommons.org/licenses/by-nc/4.0 https://jiae.ub.ac.id/index.php/jiae/article/view/1330 Thu, 29 Feb 2024 00:00:00 +0000 Determinants of Financing Decisions for Micro Enterprises in Malang City in 2022-2023 Moderated by Islamic Financial Literacy https://jiae.ub.ac.id/index.php/jiae/article/view/1283 <p><strong>Purpose</strong></p> <p>This study aims to analyze the Determinants of Financing Decisions in Micro Enterprises in Malang City Moderated by Sharia Financial Literacy</p> <p><strong>Design/methodology/approach</strong></p> <p>This research uses a mix method with <em>purposive sampling techniques</em> and the number of samples isas many as 60 respondents of micro business actors. The data of this study uses primary data obtained directly from the source using interview techniques, questionnaires, literature studies. Logistic regression is used to analyze the data.</p> <p><strong>Findings</strong></p> <p>This study revealed that variations in income and business age have a negative and significant effect on the variability of financing decisions. Meanwhile, guarantees have a positive and significant effect on the provision of financing decisions. Then, the variables of education, guarantees, and cultural characteristics do not affect the decision to provide financing. Vaiebel moderation itself is predicted to influence and strengthen the relationship between income variability and financing decisions. However, moderation variability has an influence and weakens the relationship between collateral variables and financing decisions.</p> <p><strong>Research limitations/implications</strong></p> <p>This research has limitations related to the amount of financing data conducted by Islamic banks</p> <p><strong>Originality/value</strong></p> <p>This study seeks to examine cultural characteristics with financing decisions which has rarely conducted before.</p> Fina Rosyada, Azriel Rakaha Handoko, Feri Dwi Riyanto, Sri Andriani Copyright (c) 2024 Journal of Indonesian Applied Economics https://creativecommons.org/licenses/by-nc/4.0 https://jiae.ub.ac.id/index.php/jiae/article/view/1283 Thu, 29 Feb 2024 00:00:00 +0000 Foreign Aid and Economic Growth: An Econometric Study of Afghanistan https://jiae.ub.ac.id/index.php/jiae/article/view/1297 <p><strong>Purpose</strong></p> <p>This study aims to investigate the impact of foreign aid on economic growth in Afghanistan.</p> <p><strong>Design/methodology/approach</strong></p> <p>The study employs various econometric techniques, including time series analysis. Data for the study are sourced from the country economy and world development indicators of the World Bank, covering the period from 1980 to 2021. The analysis includes Augmented Dicky Fuller and Phillips Perron unit root tests, the ARDL model, the Breusch-Godfrey Serial Correlation LM Test, and the ARDL bounds test.</p> <p><strong>Findings</strong></p> <p>The economic growth series is found to be level stationary, while the net official development assistance series is first difference stationary. Net official development assistance exhibits a significant positive short-run relationship with economic growth. No serial correlation is observed between net official development assistance and economic growth. Net official development assistance demonstrates a significant positive long-run relationship with economic growth.</p> <p><strong>Research limitations/implications</strong></p> <p>The study is based on data up to 2021, which may not capture recent developments or changes in the relationship between foreign aid and economic growth. The analysis relies on the accuracy and reliability of the data provided by the World Bank and other sources.</p> <p><strong>Originality/value</strong></p> <p>This study contributes empirical evidence on foreign aid's impact on economic growth in Afghanistan, using a range of econometric techniques. The findings highlight the importance of donor-friendly policies to increase development assistance to Afghanistan.</p> Sayed Kifayatullah Fazlly Copyright (c) 2024 Journal of Indonesian Applied Economics https://creativecommons.org/licenses/by-nc/4.0 https://jiae.ub.ac.id/index.php/jiae/article/view/1297 Thu, 29 Feb 2024 00:00:00 +0000 Comparison of Sharia Banking Performance in Malaysia and Indonesia According to Maqashid Sharia Perspectives https://jiae.ub.ac.id/index.php/jiae/article/view/1289 <p><strong>Purpose</strong></p> <p>The research objective was to analyze the difference of sharia banking performance in Malaysia and Indonesia through measurement tool of maqashid index of MPEM and PMMS</p> <p><strong>Design/methodology/approach</strong></p> <p>This research used comparative study quantitative method and secondary data with observation period of 2014-2021.</p> <p><strong>Findings</strong></p> <p>Based on the MPEM index of maqashid sharia, this research result referred that Indonesia was superior in the dimension of preserving religion, maintaining wealth, and continuing offspring. Based on PMMS maqashid sharia index, Malaysia was superior to Indonesia in all indicators consisting of educating individuals and upholding justice and welfare.</p> <p><strong>Research limitations/implications</strong></p> <p>The research objective was to analyze the difference of sharia banking performance in Malaysia and Indonesia through measurement tool of maqashid index of MPEM and PMMS period of 2014-2021</p> <p><strong>Originality/value</strong></p> <p>The countries in Southeast Asia region have applied this Dual Banking System including Indonesia and Malaysia. The use of different system applied in banking field should affect the difference of performance measurement. MPEM and PMMS were taken as alternatives of maqashid sharia-based banking performance measurement which was more proper if it was functioned to measure the performance of sharia banking.</p> Misbakhul Munir, Marlina Ekawaty, Asfi Manzilati Copyright (c) 2024 Journal of Indonesian Applied Economics https://creativecommons.org/licenses/by-nc/4.0 https://jiae.ub.ac.id/index.php/jiae/article/view/1289 Thu, 29 Feb 2024 00:00:00 +0000 Modelling the Okun’s Law in the midst of Structural Breaks: Evidence from Nigeria https://jiae.ub.ac.id/index.php/jiae/article/view/1296 <p>This objective of the study is to investigate the impact of economic growth on unemployment in Nigeria, with a view to uncovering the validity or otherwise of the Okun’s law. Both linear and non-linear specifications were considered, using quarterly data spanning 1991Q1 to 2019Q1. The study deploys a battery of cointegration techniques that account for structural breaks. The empirical result indicates that unemployment and growth are cointegrated. The estimated coefficients in both the linear and non-linear specifications show that growth is positively related to unemployment and that the impact of the latter on the former is not statistically significant. Thus, the growth experienced in the country under the period of investigation is not accompanied by reduced unemployment. Thus, whether it is the linear or the non-linear frameworks, the Okun’s law is invalid under the period of study in Nigeria. The study recommends that policies should be aimed at not merely growing the economy but deliberately targeted at sectors capable of absorbing many people such as agriculture, mining, construction and services sectors.</p> Martins Iyoboyi, Abubakar Sabitu , Samuel Felix Okereke Copyright (c) 2024 Journal of Indonesian Applied Economics https://creativecommons.org/licenses/by-nc/4.0 https://jiae.ub.ac.id/index.php/jiae/article/view/1296 Thu, 29 Feb 2024 00:00:00 +0000 The Role of Fiscal Policy in Reducing Gender Income Inequality https://jiae.ub.ac.id/index.php/jiae/article/view/1287 <p><strong>Purpose</strong></p> <p>This research aims to determine the role of fiscal policy in reducing gender income inequality in Indonesia.</p> <p><strong>Design/methodology/approach</strong></p> <p>This research used the microsimulation INDOMOD model, which is a static tax-benefit microsimulation model that has been underpinned by BPS Susenas 2019 data.</p> <p><strong>Findings</strong></p> <p>The estimation results show that the most appropriate fiscal policy to reduce gender income inequality are through PKH and BPNT. Meanwhile, income taxes for upper income levels have almost no effect, and for lower income levels, although it can reduce gender income inequality, it will increase income inequality.</p> <p><strong>Research limitations/implications</strong></p> <p>This research has several limitations which can be explored for further research. First, due to the limitations of the data, the gender term used refers to the gender of the head of household, so it does not describe the actual gender condition of the individual. Second, the income tax is calculated based on the income data available in the income block in the Susenas, so that the value does not reflect the actual condition of the income and income tax paid by taxpayers. Third, the microsimulation method is static, so it cannot be used to analyze the dynamic changes that occur at the individual level.</p> <p><strong>Originality/value</strong></p> <p>There are many studies on the relationship between fiscal policy and gender equality, but similar studies are still very limited in Indonesia. Moreover, the INDOMOD microsimulation model is rarely used in Indonesia, even though this method has been widely used in many countries.</p> Selly Galvani, Rusan Nasrudin Copyright (c) 2024 Journal of Indonesian Applied Economics https://creativecommons.org/licenses/by-nc/4.0 https://jiae.ub.ac.id/index.php/jiae/article/view/1287 Thu, 29 Feb 2024 00:00:00 +0000 The Moderating Influence of External Environment on the Link Between Strategy Implementation Determinants and Public Health Facilities Service Delivery https://jiae.ub.ac.id/index.php/jiae/article/view/1321 <p><strong>Purpose</strong></p> <p>This study aims to investigate the moderating influence of the external environment on the relationship between strategy implementation determinants and service delivery in public health facilities in the Western Region of Kenya.</p> <p><strong>Design/methodology/approach</strong></p> <p>The study adopts a positivist approach and is anchored on the McKinsey 7-S Model Framework. It utilizes descriptive survey and explanatory research designs, targeting 966 respondents including top management leaders, medical personnel, and patients. Data is collected through structured questionnaires and interview schedules, and analyzed using SPSS.</p> <p><strong>Findings</strong></p> <p>The external environment moderates the relationship between strategy implementation determinants and public health facilities service delivery in the Western Region of Kenya. Human resource capacity and organizational culture are key factors moderated by the external environment in affecting public health facilities service delivery.</p> <p><strong>Research limitations/implications</strong></p> <p>The study's findings are specific to the Western Region of Kenya and may not be generalizable to other regions or countries. The study relies on self-reported data, which may be subject to response bias.</p> <p><strong>Originality/value</strong></p> <p>This study contributes to the understanding of how the external environment influences the relationship between strategy implementation determinants and service delivery in public health facilities. The findings suggest the importance of creating an enabling environment for effective strategy implementation in the public sector to improve service delivery.</p> Momos Leonard Copyright (c) 2024 Journal of Indonesian Applied Economics https://creativecommons.org/licenses/by-nc/4.0 https://jiae.ub.ac.id/index.php/jiae/article/view/1321 Thu, 29 Feb 2024 00:00:00 +0000 Is Extreme Poverty in Indonesia is Going to End? https://jiae.ub.ac.id/index.php/jiae/article/view/1332 <p><strong>Purpose</strong></p> <p>This research aims to analyze and project extreme poverty in Indonesia. Through the method of descriptive statistical analysis and cluster analysis, it is found that the rate of decreasing in the extreme poverty rate is higher than the rate of decreasing in non-extreme poverty</p> <p><strong>Design/methodology/approach</strong></p> <p>The methods used to answer research problems are descriptive statistical analysis, econometric forecasting model analysis, and cluster analysis.</p> <p><strong>Findings</strong></p> <p>It is found that the rate of decreasing in the extreme poverty rate is higher than the rate of decreasing in non-extreme poverty. In addition, through forecasting analysis it is also found that Indonesia will be able to reduce extreme poverty to 0.30% in 2024. However, the decreasing in extreme poverty to zero percent in 2024 will be realized if the acceleration of handling extreme poverty is carried out in an integrated way through the collaboration of two interventions of extreme poverty reduction program group, that are reducing expenses and increasing income</p> <p><strong>Research limitations/implications</strong></p> <p>This research is expected to be a positive reference for the Indonesian government in implementing extreme poverty reduction policies to zero percent in 2024.</p> <p><strong>Originality/value</strong></p> <p>This research addresses the President of Indonesia's goal of achieving zero percent extreme poverty by 2024, filling a gap in existing studies. Its significance lies in evaluating the feasibility of this ambitious target.</p> Amdi Veri Darma, Nayaka Artha Wicesa, Axelllina Muara Setyanti, Teguh Maulidi Rochmat Copyright (c) 2024 Journal of Indonesian Applied Economics https://creativecommons.org/licenses/by-nc/4.0 https://jiae.ub.ac.id/index.php/jiae/article/view/1332 Fri, 01 Mar 2024 00:00:00 +0000 Livelihood Vulnerability Resilience Capacity of the Rural Economy in Nigeria’s Bauchi State https://jiae.ub.ac.id/index.php/jiae/article/view/1300 <p><strong>Purpose</strong></p> <p>This research explores the livelihood vulnerability resilience capacity of the rural economy in Nigeria's Bauchi state, aiming to inform sustainable livelihood policies in the region.</p> <p><strong>Design/methodology/approach</strong></p> <p>Data from 322 households in Bauchi state was collected using a structured questionnaire and interview schedule, employing a multi-stage random sampling technique. Descriptive and inferential statistics were used to analyze the data.</p> <p><strong>Findings</strong></p> <p>Households with more livelihood assets tend to use adaptive strategies like diversification and intensification, reducing vulnerability. However, food insecurity can mask this adaptive capacity, impacting household resilience and rural economy sustainability.</p> <p><strong>Research limitations/implications</strong></p> <p>The findings are specific to Bauchi state and may not be generalizable to other regions or countries.</p> <p><strong>Originality/value</strong></p> <p>This study sheds light on the resilience capacity of households in Bauchi state, emphasizing the importance of enhancing factors that buffer vulnerability and resilience capacity. The findings suggest that resilience capacity significantly influences food security and sustainable livelihoods in the region, highlighting the need for targeted policy interventions.</p> Sanusi Mohammed Sadiq, Invinder Paul Singh, Muhammad Makarfi Ahmad, M. B. Umar Copyright (c) 2024 Journal of Indonesian Applied Economics https://creativecommons.org/licenses/by-nc/4.0 https://jiae.ub.ac.id/index.php/jiae/article/view/1300 Fri, 01 Mar 2024 00:00:00 +0000