International Journal of Finance, Economics and Business

Analysing the Effect of Climate Change and Green Stocks on Economic Growth: Evidence from Indonesia and Malaysia

2024-05-08T16:26:45+00:00

Contemporary economic growth shows a direct correlation between energy consumption and productivity. As economic development and technological advancements enhance living standards, the demand for natural resources and energy has concomitantly increased. This investigation examines the impact of climate change and green stocks on economic growth and the causal relationships among these variables in Indonesia and Malaysia over short- and long-term periods. Climate change has resulted in a downward trend in economic growth fluctuations, underscoring the necessity for green finance to mitigate the effects of climate change. The study employs the Autoregressive Distributed Lag (ARDL) model and Granger Causality test, analysing data on carbon emissions, green stocks, and gross domestic product from 2016-2022 (quarterly). The findings indicate that, in the short term, only green stocks positively influence economic growth in Indonesia and Malaysia. In the long run, climate change and green stocks positively affect economic growth in these countries. Economic growth demonstrates a unidirectional causal relationship with climate change, whereas climate change exhibits a unidirectional causal relationship with green stocks. This implies that green stock can mitigate climate change risks in Indonesia and Malaysia. It is recommended that the central bank consider implementing an environmentally sustainable financial system to promote economic growth.

The Effect of Domestic Investment, Foreign Investment, Labor, Unemployment, Human Development Index, and Inflation on Poverty in Indonesia

2024-06-16T06:02:35+00:00

Indonesia continues to contend with elevated levels of poverty, reflecting the diminished well-being experienced by a segment of its population. Various socio-economic factors influence the poverty rate. It is hypothesized that domestic and foreign investments, workforce participation, and the Human Development Index (HDI) could reduce poverty, while unemployment and inflation might exacerbate it. However, previous research has not reached a consensus on these relationships. This study examines the impact of domestic and foreign investments, labor force, unemployment, HDI, and inflation on poverty levels in Indonesia. The research employs panel data regression analysis, utilizing data from 34 Indonesian provinces spanning 2006 to 2022. The findings indicate that the fixed effect model is the most appropriate for this analysis. The study concludes that domestic investment, foreign investment, and labor force have a significant negative correlation with poverty. Conversely, unemployment demonstrates a significant positive relationship with poverty rates. Notably, the HDI and inflation do not significantly affect poverty in Indonesia. To address these issues, the Indonesian government should focus on enhancing domestic and foreign investor confidence by improving legal certainty and offering various incentives to stimulate investment. Furthermore, the government must prioritize improving education and healthcare services to elevate HDI and alleviate poverty.

Agency Banking Adoption Trends among Bank Customers in Tanzania: A Continued Perspective

2024-07-04T01:59:18+00:00

Agency banking has become crucial for expanding financial inclusion by offering banking services to underserved urban and rural areas. This study examines the behavioral factors affecting customers' continued intention to adopt agency banking using the Expectation-Confirmation Model (ECM). Data was gathered through closed-ended questionnaires distributed via Google Forms and drop-off/pick-up methods, resulting in 166 responses analyzed with Partial Least Squares Structural Equation Modeling (PLS-SEM) using SMARTPLS 4.0 software. Findings indicate that customers’ satisfaction, subjective norms, perceived usefulness, and perceived convenience significantly and positively impact the continued intention to adopt agency banking. However, perceived cost and perceived trust were not significant. Additionally, perceived usefulness and confirmation significantly and positively impact customer satisfaction, while confirmation significantly impacts perceived usefulness. Mediation analysis showed that satisfaction and perceived usefulness significantly mediate the relationships examined. To enhance customers' intention to continue using agency banking, policymakers should develop strategies that promote communal culture, positive behavior towards agency banking, increased services, and broader understanding of its benefits. This research offers insights for academics and practitioners on improving adoption strategies and policies to boost financial inclusion.

Does Bank Credit Fluctuation Affect Inflation? Evidence from Indonesia

2024-07-04T03:19:09+00:00

Both developed and developing nations frequently encounter the economic challenges of inflation. Middle- and low-income developing countries generally experience higher inflation rates than their high-income developed counterparts. Interest rates influence the relationship between credit distribution and inflation. This study examines how fluctuations in bank lending affect inflation in Indonesia. Monthly data from 2016 to 2023 were analyzed using the Autoregressive Distributed Lag (ARDL) approach. The findings reveal that working capital loans significantly positively affect Indonesian inflation in both the short and long term. While investment credit shows no short-term impact on inflation, it significantly positively influences the long run. Consumptive credit exhibits a significant positive effect on inflation in the short term but a significant negative effect in the long term. The BI rate shows no short-term influence on inflation. However, it has a significantly negative impact in the long term. Based on these results, it is recommended that Bank Indonesia enhance its coordination of monetary stability, inflation control, and financial system improvements, particularly regarding interest rates. Additionally, banks acting as intermediaries should monitor the utilization of working capital, investments, and consumptive credit to help manage inflation in Indonesia.

The Impact of Income Inequality, Human Development, Gender Development and Open Unemployment on Economic Growth in Indonesia

2024-07-04T07:54:33+00:00

Good economic growth reflects equitable income distribution and high labour absorption, leading to job creation. Addressing economic development is a government priority in Indonesia to tackle poverty, inequality, income disparity, and unemployment. This study investigates the impacts of income inequality, human development, gender development, and open unemployment on economic growth in Indonesia using panel data regression from 34 provinces (2015-2022). Data on income inequality, the human development index, the gender development index, and the open unemployment rate are from the Central Bureau of Statistics Indonesia, while economic growth data are from the SIMREG Bappenas. The results indicate that the fixed effects model is optimal. Income inequality, the human development index, and the open unemployment rate negatively and significantly affect economic growth, while the gender development index has a positive and significant effect. This study proposes that the Indonesian government should consider implementing measures to reduce income inequality through taxation policies and enhance education, healthcare, and infrastructure in remote areas.

The Effect of Organizational Readiness and Top Management Support on Supply Chain Management Performance: The Mediating Role of Accounting Information Systems

2024-10-08T16:47:44+00:00

Micro, small, and medium enterprises (MSMEs) are crucial to the economies of developing countries like Indonesia, demonstrating resilience during economic challenges such as the 1998 financial crisis. This study investigates how organizational readiness and top management support affect supply chain management performance in MSMEs, with the success of accounting information systems as a mediating factor. Using purposive sampling and G*Power software, 178 MSMEs from diverse sectors were analyzed via Partial Least Squares (PLS). Results show that organizational readiness and top management support significantly impact supply chain management performance and the success of accounting information systems in Pekanbaru, Indonesia. However, accounting information system success does not mediate the relationship between organizational readiness, top management support, and supply chain management performance. This indicates that other factors might serve as critical mediators. To improve supply chain management performance, MSMEs should enhance organizational readiness and secure top management support. Future research should investigate alternative mediators, such as technology or innovation, and include studies across various sectors for broader insights.