Jurnal Ekonomi dan Pembangunan Vol. 30 No. 2 Tahun 2022
The Impact of Physical Capital and Human Capital on Growth in Indonesia, 1970–2017
Dublin Core
Title
Jurnal Ekonomi dan Pembangunan Vol. 30 No. 2 Tahun 2022
The Impact of Physical Capital and Human Capital on Growth in Indonesia, 1970–2017
The Impact of Physical Capital and Human Capital on Growth in Indonesia, 1970–2017
Subject
economic growth; human capital; autoregressive distributed lag (ARDL); Indonesia’s sustainable
development policy
development policy
Description
The purpose of this study is to investigate, using relevant robust econometric modelling, physical capital
and human capital, and their impact on growth in Indonesia for policy analysis. Indonesia is already underway
to the structural transformation from basic sector to industry and service sectors which requires corresponding
human capital. It is very crucial to investigate which level education has been in demand for such transformation
process. Therefore, the auto regressive distributed lag (ARDL) by Pesaran and Pesaran (1997) was chosen for
supporting the relationship analysis using data from 1970 to 2017. The important finding for policy analysis was
that human capital appeared to be a continuing factor shaping Indonesia’s growth, along with physical capital
accumulation, with particularly strong effects for human capital arising from tertiary education. Physical capital
has shown a strong and significant impact on the growth in the long run and indicated that Indonesia needs long
term investment to generate growth. Such investment has distinctions related to sustainable operation such as
infrastructure, sophisticated services, and venture capital. Consequently, it requires high skill labour supplied by
tertiary education institutions. A further development of tertiary education next to enhancement of investment
environment in manufacture and service sector should be set as priority programs in inducing growth.
and human capital, and their impact on growth in Indonesia for policy analysis. Indonesia is already underway
to the structural transformation from basic sector to industry and service sectors which requires corresponding
human capital. It is very crucial to investigate which level education has been in demand for such transformation
process. Therefore, the auto regressive distributed lag (ARDL) by Pesaran and Pesaran (1997) was chosen for
supporting the relationship analysis using data from 1970 to 2017. The important finding for policy analysis was
that human capital appeared to be a continuing factor shaping Indonesia’s growth, along with physical capital
accumulation, with particularly strong effects for human capital arising from tertiary education. Physical capital
has shown a strong and significant impact on the growth in the long run and indicated that Indonesia needs long
term investment to generate growth. Such investment has distinctions related to sustainable operation such as
infrastructure, sophisticated services, and venture capital. Consequently, it requires high skill labour supplied by
tertiary education institutions. A further development of tertiary education next to enhancement of investment
environment in manufacture and service sector should be set as priority programs in inducing growth.
Creator
Firman Bunyamin
Source
https://jurnalekonomi.lipi.go.id/JEP
Date
2022
Contributor
peri irawan
Format
pdf
Language
indonesia
Type
text
Files
Collection
Citation
Firman Bunyamin, “Jurnal Ekonomi dan Pembangunan Vol. 30 No. 2 Tahun 2022
The Impact of Physical Capital and Human Capital on Growth in Indonesia, 1970–2017,” Repository Horizon University Indonesia, accessed February 3, 2025, https://repository.horizon.ac.id/items/show/3147.
The Impact of Physical Capital and Human Capital on Growth in Indonesia, 1970–2017,” Repository Horizon University Indonesia, accessed February 3, 2025, https://repository.horizon.ac.id/items/show/3147.