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Multi period shocks roles on government spending in Indonesia

Author

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  • Jaka Sriyana

    (Faculty of Economics, Universitas Islam Indonesia)

Abstract

This paper proposes an alternative dynamic model of government spending in Indonesia. The model is based on short term disequilibrium assumption, in which multi period of shocks variables may play an important role. This research applies a loss function approach and uses optimum shock variables as the determinant for government spending during 1970-2010. The result shows that real GDP, population, and multi period shock of government spending are statistically significant. It provides evidence of the impact of multi period shocks to the realization of government spending. It implies that government faces a serious disequilibrium in determining their spending both in short and long terms.

Suggested Citation

  • Jaka Sriyana, 2010. "Multi period shocks roles on government spending in Indonesia," Economic Journal of Emerging Markets, Universitas Islam Indonesia, vol. 2(3), pages 251-264, April.
    • Handle: RePEc:uii:journl:v:2:y:2010:i:3:p:251-264
    as

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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Fiscal; government spending; deficit budget; shock;
    All these keywords.

    JEL classification:

    • H53 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Welfare Programs
    • H62 - Public Economics - - National Budget, Deficit, and Debt - - - Deficit; Surplus
    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes

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