Determinant of Exchange Rate with Hybrid Model: Empirical Evidence from Indonesia
Determinant of Exchange Rate with Hybrid Model: Empirical Evidence from Indonesia
Author(s): Tony Seno Aji, Munawar Ismail, Ghozali Maski, Dwi Budi SantosoSubject(s): National Economy, Business Economy / Management, Micro-Economics, Economic development, Present Times (2010 - today)
Published by: Reprograph
Keywords: exchange rate; hybrid model; microstructure model; macroeconomic model; error correction model;
Summary/Abstract: The purpose of this study is to examine the determinants of the exchange rate in Indonesia by using a hybrid model which is a combination of macroeconomic model with a model of the microstructure. Furthermore, hybrid models are estimated using an error correction model of Domowitz El-Badawi. The results show that five macro variables (money supply, interest rates, inflation, output growth, and capital flow) and a variable microstructures (inventory) has a significant influence on the determination of the exchange rate.
Journal: Journal of Applied Economic Sciences (JAES)
- Issue Year: XI/2016
- Issue No: 44
- Page Range: 1026-1029
- Page Count: 4
- Language: English