Indonesia Growth of Economics and the Industrialization Biodiesel Based CPO

Authors

  • Faurani Santi Singagerda University of Sang Bumi Ruwa Jurai
  • Tri Yuni Hendrowati University of Sang Bumi Ruwa Jurai
  • Anuar Sanusi IIB Darmajaya

Abstract

This study aimed to analyses the impact of palm oil-based biodiesel development on growth and poverty in Indonesia that combined with government policy using simultaneous equation econometric 2 SLS's models. The result shows that if the export tax, and government expenditure in industry increase; then domestic exchange rate (IDR) and interest rate decrease, those will give positive impact on economy growth and vice versa gives a negative impact to poverty. The simulation may apply to know the impact on economy growth, and poverty in Indonesia by the development. The study found that palm oil-based biodiesel development can create a growth and poverty in Indonesia and CPO biodiesel development can be synergized with the increasing export tax and government expenditure in industry, so growth and poverty-reducing in Indonesia will be better and qualify. However, government must maintain stability of exchange rate fluctuation because the impact can reduce CPO production industry.

Keywords: Crude Palm Oil, Energy, Industry, Economic growth, Poverty

JEL Classifications: E24, E27, C5, O31

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Author Biographies

Faurani Santi Singagerda, University of Sang Bumi Ruwa Jurai

Department of Economics

Tri Yuni Hendrowati, University of Sang Bumi Ruwa Jurai

Departmjent of Economics

Anuar Sanusi, IIB Darmajaya

Department of Economics

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Published

2018-09-05

How to Cite

Singagerda, F. S., Hendrowati, T. Y., & Sanusi, A. (2018). Indonesia Growth of Economics and the Industrialization Biodiesel Based CPO. International Journal of Energy Economics and Policy, 8(5), 319–334. Retrieved from https://www.econjournals.com/index.php/ijeep/article/view/6590

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