DAMPAK KREDIBILITAS KEBIJAKAN FISKAL PADA SUKU BUNGA DI INDONESIA

PUTRI, RATU NABILA SARAS (2016) DAMPAK KREDIBILITAS KEBIJAKAN FISKAL PADA SUKU BUNGA DI INDONESIA. S1 thesis, Universitas Negeri Jakarta.

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Abstract

ABSTRACT RATU NABILA SARAS PUTRI. The Impact of Fiscal Policy Credibility on Interest Rate: The Case of Indonesia. Cooperative Economics Education, Economics and Administration, Faculty of Economics, State University of Jakarta, in 2015. The objective of this paper is to investigate whether the effects of fiscal policy credibility, in the form of deficit rule, debt rule, discretionary, and openness, can affect the stability of interest rates. The method used in this study is in the form of time series of the year 2001 (1) -2013 (4) with a sample of 52 points. The data are taken from the central bank of Indonesia (www.bi.go.id) and Central Board of Statistics (www.bps.go.id). The total debt in domestic currency comes from Debt Management Office (www.djpu.kemenkeu.go.id). This study applies Ordinary Least Square (OLS) model by adding a dummy variable, namely the phenomenon of financial crisis of 2008 and inflation targeting in 2005. The findings indicate the model of deficit rule is not significant and does not contribute in stabilizing interest rates in the goods market. Furthermore, the rules of the debt by adding a dummy variable inflation targeting in 2005 showed that the debt rules can influence the interest rate. The increase in the debt rules can lower interest rates. Then, discretion will raise interest rates, so that it can be concluded that the discretion is not credible because it could raise interest rates. The findings further, openness will raise interest rates. Furthermore, by adding dummy variables 2008 financial crisis shows that the crisis phenomena have an influence on interest rates. Then, the dummy variable inflation targeting in 2005 showed significant results. This implies that inflation targeting in 2005 had an impact on interest rates in the market for goods. The economic implications of these findings, if the debt can be realized closely to the planned debt, the deviation will be small then interest rates will stabilize. The government could re-structure, because in the goods market interest rates cannot predict its changes. Therefore, any policy rules that are taken must consider the future, so that the burden is not large in the future. Furthermore, openness in the long term, the government has to intervene in order to reduce the volatility of interest rates. Keywords : deficit rule, debt rule, discretionary, openness, interest rate

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