Open AccessExport Determinant of Micro, Small, and Medium Enterprise Products (MSMEs) in Indonesia with Error Correction Model (ECM) Approach
Author(s) -
Cicih Ratnasih,
. Sumarni,
M. Imron Rosyadi,
Dedy Triharjanto,
. Yolanda
Publication year - 2021
Publication title -
european journal of business and management research
Language(s) - English
Resource type - Journals
ISSN - 2507-1076
DOI - 10.24018/ejbmr.2021.6.6.1157
Subject(s) - error correction model , liberian dollar , inflation (cosmology) , exchange rate , investment (military) , term (time) , monetary economics , us dollar , economics , medium term , product (mathematics) , international economics , econometrics , macroeconomics , mathematics , finance , cointegration , physics , geometry , quantum mechanics , politics , theoretical physics , political science , law
This study analyzes the relationship between the exchange rate of the rupiah against the US dollar, MSME growth, investment, MSME credit, and inflation all have an effect on MSME exports in Indonesia. The purpose of this study is to determine the extent to which the independent factors above have an effect on MSME product exports using multiple linear regression analysis. The Error Correction Mechanism (ECM) analytical approach was employed in this study, which covered the period 2010-2020. ECM analysis is capable of resolving short- to long-term imbalances. This study demonstrates that there is no such thing as a short-term-long-term equilibrium. Partially, the rupiah exchange rate against the US dollar, investment, and inflation all had a significant effect on the export of MSME products in Indonesia, while the rupiah exchange rate against the US dollar, MSME growth, and investment all had a significant effect on the export of MSME products in the short term. At various points in time (long and short term), it can be seen that the rupiah's exchange rate against the US dollar and investment had a substantial impact on MSME exports. Simultaneously, all variables had a major effect on the export of MSME products in Indonesia, both in the long and short term.