Analyzing the Impact of Foreign Direct Investment, Money Flow Dynamics, and Inflation on Economic Growth: Evidence from Special Economic Zones

https://doi.org/10.62157/ijbefs.v1i1.8

Authors

  • Andriansyah Andriansyah Doctoral Program of Management, Faculty of Economics and Business, Universitas Sumatera Utara, Medan Baru, 20222 Kota Medan, Sumatera Utara, Indonesia
  • Erlina Erlina Doctoral Program of Management, Faculty of Economics and Business, Universitas Sumatera Utara, Medan Baru, 20222 Kota Medan, Sumatera Utara, Indonesia
  • Amlys Syahputra Silalahi Doctoral Program of Management, Faculty of Economics and Business, Universitas Sumatera Utara, Medan Baru, 20222 Kota Medan, Sumatera Utara, Indonesia
  • Isfenti Sadalia Faculty of Vocational, Universitas Sumatera Utara, 20155 Medan Baru, Kota Medan, Sumatera Utara, Indonesia
  • Rico Nur Ilham Department of Management, Faculty of Economics and Business, Universitas Malikussaleh, Blang Pulo, 24353 Muara Satu, Lhokseumawe, Aceh, Indonesia

Keywords:

Foreign direct investment, Velocity of money, Inflation, Economic growth

Abstract

Establishing robust Special Economic Zones within the determined territorial boundaries of the Republic of Indonesia is crucial for attracting increased investments, fostering industrial growth, and optimizing economic activities with high value, propelling the nation's economic development forward. This study determines the effects of foreign direct investment, velocity of money, and inflation on economic growth in Indonesian Special Economic Zones. This time series approach involves 35 years of data collected from the Central Bureau of Statistics Indonesia. The result indicates that foreign direct investment and money velocity significantly affect economic growth. Besides that, inflation does not affect economic growth. In conclusion, this study has successfully identified the factors influencing economic growth. Also, this study found that inflation does not significantly affect economic growth in Indonesia's Special Economic Zones.

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Published

31-05-2023

Issue

Vol. 1 No. 1 (2023): May 2023

Section

Articles

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This work is licensed under a Creative Commons Attribution 4.0 International License.

Copyright @2023. This is an open-access article distributed under the terms of the Creative Commons Attribution 4.0 International License (https://creativecommons.org/licenses/by/4.0/) which permits unrestricted to copy and redistribute the material in any medium or format, remix, transform, and build upon the material for any purpose, even commercially.


Creative Commons License
This work is licensed under a Creative Commons Attribution 4.0 International License.