Investment and Unemployment Reduction: An Empirical Study of Indonesia using Panel Data Regression

Bahrul Ilmi Nasution, Adelia Christine Br. Tarigan, Sri Indriyani Siregar

Abstract

One of Indonesia’s seven development agendas is the improvement of competitive human resources. Therefore, government concerns in reducing employment. Currently, one of the government’s efforts to reduce unemployment is to increase investment in various regions. This study aims to identify the effect of investment realization to the unemployment in Indonesia by using provincial panel d ata from 2006 to 2018. Furthermore, investments in this study are divided into foreign and domestic direct investment. The panel data evaluation gives a result that Feasible Generalized Least Squares with Seemingly Unrelated Regression (FGLS-SUR) is a suitable estimation for the analysis. Based on the model, this study finds that both foreign and domestic direct investments give a significant effect in reducing unemployment. This study can be used as a recommendation for the government to increase investment, especially the domestic, as well as sectors that absorb labor to accelerate the economic wheel and reduce the unemployment simultaneously.

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Paper Citation


in Harvard Style

Nasution B., Br. Tarigan A. and Siregar S. (2020). Investment and Unemployment Reduction: An Empirical Study of Indonesia using Panel Data Regression. In Proceedings of the 2nd International Conference on Applied Economics and Social Science - Volume 1: ICAESS, ISBN 978-989-758-517-3, pages 71-79. DOI: 10.5220/0010356600710079


in Bibtex Style

@conference{icaess20,
author={Bahrul Ilmi Nasution and Adelia Christine Br. Tarigan and Sri Indriyani Siregar},
title={Investment and Unemployment Reduction: An Empirical Study of Indonesia using Panel Data Regression},
booktitle={Proceedings of the 2nd International Conference on Applied Economics and Social Science - Volume 1: ICAESS,},
year={2020},
pages={71-79},
publisher={SciTePress},
organization={INSTICC},
doi={10.5220/0010356600710079},
isbn={978-989-758-517-3},
}


in EndNote Style

TY - CONF

JO - Proceedings of the 2nd International Conference on Applied Economics and Social Science - Volume 1: ICAESS,
TI - Investment and Unemployment Reduction: An Empirical Study of Indonesia using Panel Data Regression
SN - 978-989-758-517-3
AU - Nasution B.
AU - Br. Tarigan A.
AU - Siregar S.
PY - 2020
SP - 71
EP - 79
DO - 10.5220/0010356600710079