Simultaneity Analysis between Portfolio Investment and Macroeconomic Variables in Indonesia

Lia Nazliana Nasution, Tiur Malasari Siregar, Isfenti Sadalia

2019

Abstract

Macroeconomic variables play an essential role in determining portfolio investment inflows in a country. If one macroeconomic variable changes, investors will react positively or negatively depending on whether the changes in the macroeconomic variables are positive or negative in the eyes of investors. The objective of this study analyzes the effect of macroeconomic variables on portfolio investment in Indonesia. Suspected economic variables are influential, namely the exchange rate (ER), interest rate (IR), inflation, and economic growth (growth) sourced from the World Bank. With a 30-year observation period from 1989 to 2018, and the method used simultaneous regression analysis, the findings show that ER, IR, and growth have a positive effect on demand for portfolio investment in Indonesia while inflation and portfolio investment has a significant negative impact on growth.

Paper Citation

in Harvard Style

Nasution L., Siregar T. and Sadalia I. (2019). Simultaneity Analysis between Portfolio Investment and Macroeconomic Variables in Indonesia. In Proceedings of the 2nd Economics and Business International Conference - Volume 1: EBIC, ISBN 978-989-758-498-5, pages 549-554. DOI: 10.5220/0009326505490554

in Bibtex Style

@conference{ebic19,
author={Lia Nazliana Nasution and Tiur Malasari Siregar and Isfenti Sadalia},
title={Simultaneity Analysis between Portfolio Investment and Macroeconomic Variables in Indonesia},
booktitle={Proceedings of the 2nd Economics and Business International Conference - Volume 1: EBIC,},
year={2019},
pages={549-554},
publisher={SciTePress},
organization={INSTICC},
doi={10.5220/0009326505490554},
isbn={978-989-758-498-5},
}

in EndNote Style

TY - CONF

JO - Proceedings of the 2nd Economics and Business International Conference - Volume 1: EBIC,
TI - Simultaneity Analysis between Portfolio Investment and Macroeconomic Variables in Indonesia
SN - 978-989-758-498-5
AU - Nasution L.
AU - Siregar T.
AU - Sadalia I.
PY - 2019
SP - 549
EP - 554
DO - 10.5220/0009326505490554