Analysis of the Effect of Inflation, GDP, and BI Rate on FDI in Indonesia in 1990-2020

Novita Sari, Maulidyah Indira Hasmarini

Abstract


This study aims to determine how inflation relations, gross domestic product, and BI rate affect foreign direct investment in Indonesia. This study used the Ordinary Least Square (OLS) approach to analyze time series data for the 19902020 period, using estimation steps, classical assumption tests, model goodness, and regression coefficients of determination. The results showed that the variables of gross domestic product and BI rate had a positive and significant effect on foreign direct investment in Indonesia. In addition, inflation does not affect foreign direct investment. In an effort to increase foreign direct investment, the government plays a role in paying attention to macroeconomic impacts and utilizing and being expected to cooperate in maintaining stability through other economic variables.



Keywords


Inflation, GDP, BI Rate

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References


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DOI: https://doi.org/10.30596/miceb.v1i0.166

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