THE RELATIONSHIP BETWEEN FOREIGN DIRECT INVESTMENT AND GROSS DOMESTIC PRODUCT IN INDONESIA
Indonesia is growing country that concern to its economic development. It has tried to <br /> <br /> <br /> <br /> <br /> develop since it first declared its independence. Since 1998, Indonesia had experienced <br /> <br /> <br /> <br /&...
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| Format: | Final Project |
| Language: | Indonesia |
| Online Access: | https://digilib.itb.ac.id/gdl/view/25338 |
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| Institution: | Institut Teknologi Bandung |
| Language: | Indonesia |
| Summary: | Indonesia is growing country that concern to its economic development. It has tried to <br />
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develop since it first declared its independence. Since 1998, Indonesia had experienced <br />
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many crisis. Some of crisis were crisis on 1998 and crisis on 2008. The reason why the <br />
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crisis happened was caused by fund need from many sectors in Indonesia. On crisis 1998, <br />
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the main reason that caused crisis was because leakage in private business sector of <br />
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Indonesia that borrowed money from foreign investor and on crisis 2008, the main reason <br />
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that caused crisis was because money withdrawal by foreign investor. All of the reasons <br />
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were related to condition of foreign investment in Indonesia. <br />
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Foreign direct investment is considered brings impact to economic development of <br />
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Indonesia that is usually denominated by gross domestic product (GDP). Try to prove the <br />
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relationship between foreign direct investment and gross domestic product of Indonesia is <br />
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main objective in this research. This research talks about linear regression analysis <br />
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between two variables. The two variables are FDI as independent variable and GDP as <br />
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dependent variable. Used Gauss Markov assumptions helps in proving the validity of <br />
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regression. It will show that the regression is BLUE that followed by some terminologies. <br />
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The terminologies that pertains BLUE are heteroskedasticiy, autocorrelation, <br />
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multicollinearity, and normal distribution. Computing the data by SPSS software supports <br />
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analysis related to that BLUE. <br />
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Baesd on T-test , it concludes to reject Ho that says FDI does not drive GDP. It does not <br />
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reject Ha that says FDI drives GDP. It indicates from R Squared that 86.3% variance of <br />
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Gross Domestic Product is affected by independent variable of FDI and there is stil 13.7% <br />
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variance of Gross Domestic Product is affected by other independent variables. The <br />
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assumptions of Gauss Markov that talks about heteroskedasticity, autocorrelation, <br />
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multicolinearity and normal distribution have been covered and showed positive answer. <br />
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F rom histogram, normal P-P Plot and scatterplot, it answered the assumptions that the <br />
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errors of data have no autocorrelation, have fulfilled the heteroskedasticity, and have <br />
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shown to be distributed well in normal distribution. Because this type of analysis is simple <br />
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linear regression analysis, it does not related to multicolinearity. This results significantly <br />
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proves that the regression is BLUE. <br />
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By this depth analysis, it proves relationship between the independent variable FDI and the <br />
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dependent variable GDP. Through positive relationship between FDI and GDP, future <br />
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GDP condition in Indonesia could be predicted by past FDI condition in Indonesia. It is <br />
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hoped that this can bring knowledge for better understanding about economic condition in <br />
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Indonesia. <br />
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Keyword: Foreign Direct Investment, Gross Domestic Product |
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