The Causal Relationship between Crude Oil Price, Exchange Rate and Rice Price

Authors

  • Pasrun Adam Universitas Halu Oleo http://orcid.org/0000-0001-5597-7554
  • Rosnawintang Rosnawintang Universitas Halu Oleo
  • La Ode Saidi Universitas Halu Oleo
  • La Tondi Universitas Halu Oleo
  • La Ode Arsad Sani Universitas Halu Oleo

Abstract

This study aims to examine the causal relationship between crude oil price, IDR/EUR exchange rate, and rice price by using monthly data from January 2000 to September 2017. The result of data analysis using VAR model shows that there is no long-term relationship between crude oil price, IDR/EUR exchange rate, and the price of rice. The relationhip that happens is only in short-term one. Granger causality test result shows that the direction of relationship is from crude oil price and IDR/EUR exchange rate to rice price. The relationship between crude oil price and rice price is positive, while the relationship between IDR/EUR exchange rate and rice price is positive before the third month. However, this relationship turns into negative after the third month.   

Keywords: Crude oil price, exchange rate, rice price, VAR model.

JEL Classifications: C58, G150, Q13, Q430  

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Published

2018-01-24

How to Cite

Adam, P., Rosnawintang, R., Saidi, L. O., Tondi, L., & Sani, L. O. A. (2018). The Causal Relationship between Crude Oil Price, Exchange Rate and Rice Price. International Journal of Energy Economics and Policy, 8(1), 90–94. Retrieved from https://www.econjournals.com/index.php/ijeep/article/view/5774

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