Proceedings of the 1st Aceh Global Conference (AGC 2018)

Dynamic Causal Relationship between Government Expenditures and Revenues in Indonesia

Authors
Sri Rosmiati Sani, Sofyan Syahnur, Raja Masbar, M.S.A Majid
Corresponding Author
Sofyan Syahnur
Available Online January 2019.
DOI
https://doi.org/10.2991/agc-18.2019.82How to use a DOI?
Keywords
Dynamic Causality, Government Expenditure, Revenues, Fiscal Policy, Vector autoregression
Abstract
This paper examines the causal relationship between government expenditure and revenues in Indonesia during the period 1963 to 2017 by using the Vector Auto Regression (VAR) model. The results show that there is a strong relation and it represents a bi-directional causality between expenditure and revenue. However, government expenditure and revenue relationship is negative and revenue is positively related to government expenditure. This supports Wagner's law related to fiscal policy in Indonesia from revenue to expenditure. The finding also shows that the longer expenditure does not have an impact on increasing revenue and it stimulates a greater gap in the fiscal deficit in Indonesia. In order to cover the fiscal deficit, Indonesian government policy really relies on loans.
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This is an open access article distributed under the CC BY-NC license.

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Volume Title
Proceedings of the 1st Aceh Global Conference (AGC 2018)
Series
Advances in Social Science, Education and Humanities Research
Publication Date
January 2019
ISBN
978-94-6252-644-0
ISSN
2352-5398
DOI
https://doi.org/10.2991/agc-18.2019.82How to use a DOI?
Open Access
This is an open access article distributed under the CC BY-NC license.

Cite this article

TY  - CONF
AU  - Sri Rosmiati Sani
AU  - Sofyan Syahnur
AU  - Raja Masbar
AU  - M.S.A Majid
PY  - 2019/01
DA  - 2019/01
TI  - Dynamic Causal Relationship between Government Expenditures and Revenues in Indonesia
BT  - Proceedings of the 1st Aceh Global Conference (AGC 2018)
PB  - Atlantis Press
SP  - 553
EP  - 557
SN  - 2352-5398
UR  - https://doi.org/10.2991/agc-18.2019.82
DO  - https://doi.org/10.2991/agc-18.2019.82
ID  - Sani2019/01
ER  -