Exchange rate volatility and COVID-19 effects on Indonesia's food products' trade: Symmetric and asymmetric approach.

This study aims to determine the symmetric and asymmetric effects of exchange rate volatility and other explanatory variables (real exchange rate, industrial production index, and COVID-19) on sixteen (16) food products traded between Indonesia and the United States, Indonesia and China. The study used the ARCH/GARCH approach and estimate the volatility of the exchange rate. Linear and nonlinear autoregressive distributed lag (ARDL) were applied to estimate the short- and long-run effect for the period 2009:M1-2020:M12. Findings from the ARDL method indicate that, in the short-term exchange rate volatility has a significant positive/negative effect on many products exported and imported throughout the study period. Different results were found in the Nonlinear ARDL method where a significant effect occurred especially on the food products import. The result further indicates that exchange rate volatility has a more negative effect symmetrically or asymmetrically. These results imply that most Indonesian traders to the United States and China tend to behave as risk-averse in the long run when responding to the phenomenon of exchange rate volatility. As a measure of robustness, a quantile regression further confirms that exchange rate volatility consistently affects food product trade. With this, therefore, stable exchange rate policies are needed to lessen the harmful effect of volatility on trade flows and balance the risk-taking behaviour among importers and exporters.

Determinants of exports performance: Evidence from Indonesian low-, medium-, and high-technology manufacturing industries.

This study explores the determinants of the export performance of Indonesia's low-, medium-, and high-technology manufacturing industries by focusing on the role of raw-material imports and technical efficiency. Micro firm-level data from 2010-2015 were utilized for the analysis in this study. The stochastic frontier analysis was employed to measure technical inefficiency and to determine its effect on export performance. Our findings indicate that in all categories of industry technical efficiency, raw materials imports, foreign direct investment (FDI), location, firm size, labour productivity, and concentration of industries were significant determinants of export performance. While high efficiency increases exports in low- and medium-technology firms, exports decrease in firms with high efficiency accompanied by high imports, FDI, size, and labour productivity. Furthermore, in high-technology industries, efficiency reduces exports and again increases them when mediated by a concentration of industries and location. The empirical strategy also supports the positive effect of imports on export performance in both industries, which also aligns with decreased exports in firms with high imports accompanied by high FDI, efficiency, labour productivity, the concentration of industries, and size. To this end, the study has implications for low-, medium-, and high-technology manufacturing that are mainly concerned with increasing exports.

The effect of income inequality on carbon dioxide emissions: A case study of Indonesia.

The main objective of this study was to investigate the effect of income inequality on carbon dioxide (CO2) emissions in Indonesia from 1975 to 2017 using the Autoregressive Distributed Lag (ARDL) technique. Per capita GDP, urbanization, and dependency ratio are included as additional variables in the analytical models. The statistical estimation and tests showed that income inequality has a negative effect on CO2 emissions but the relationship pattern depends on the level of per capita GDP. An inverted U-shaped relationship was also observed between per capita GDP and CO2 emissions. This indicates the existence of an Environmental Kuznets Curve (EKC) in Indonesia. Moreover, both urbanization and the dependency ratio have a negative effect on CO2 emissions. This study suggests that income equality should be added to the policies formulated to aid economic growth in order to ensure that there is a reduction in CO2 emissions.