The Role Of Economic Fundamentals In Explaining Indonesian Currency Crisis
Bibliographic record
Abstract
This paper examines the determinants of currency crisis, particularly the role of economic fundamentals in explaining the currency crisis in Indonesia in the 1990’s. This study has an objective: to analyze the role of the ratio of M2 to reserves, the ratio of banks’ claims on the private sector to Gross Domestic Product, the ratio of current account deficit to Gross Domestic Product, the growth rate of Gross Domestic Product, reserves to import ratio, exchange rate system in explaining the currency crisis in Indonesia during period of observation. Using time series quarterly data for Indonesia spanning the period of quarter one 1990 to quarter four 2001, this study employs a simple regression model modified from the previous research, in which the change in the rupiah exchange rate is a linear function of the economic variables that represent the economic fundamentals of Indonesian economy. By using the Statistical Package for Social Science (SPSS), the results of this study indicate that selected variables of economic fundamentals simultaneously contribute to the currency crisis. The value of coefficient determination (R2) of 0.959 indicates “the goodness of fit” toward group of data, and implies that 95.9 % of the variation in the rupiah exchange rate during the period of observation can be explained by the chosen variables. The linkage between economic fundamentals and the currency crisis is also supported by regression model, in which the increase in the ratio of banks’ claim on private sector to GDP and the increase in the ratio of current account deficit to GDP led to the depreciation of the rupiah exchange rate during the observation. Similarly, the growth rate of GDP has had a positive impact on the rupiah exchange rate, which means that growth rate of GDP led to an appreciation of rupiah exchange rate. The abandonment of the pegged exchange rate system resulted in the depreciation of the rupiah exchange rate. For this reason, it is reasonable to argue that there is a linkage between the weaknesses of economic fundamentals and currency crisis during observation. However, the ratio of M2 to reserves is statistically insignificant.
Fetched live from OpenAlex and de-inverted. Abstracts are not stored in this database: the inverted indexes are 8.6 GB of the frame’s 9.3 GB of text, and the host has 13 GB free.
How this classification was reachedexpand
Full frame distilled prediction
Teacher imitationNot calibrated prevalence, not ground truth. Human validation pending. Learned from the 10,348 direct Codex labels and 10,348 direct Gemma labels. Candidate is the union of thresholded teacher heads; consensus is their intersection. These outputs are machine_predicted_unvalidated and are not human labels or direct frontier model labels.
Codex and Gemma teacher scores by category
| Category | Codex | Gemma |
|---|---|---|
| Metaresearch | 0.003 | 0.000 |
| Meta-epidemiology (narrow) | 0.000 | 0.001 |
| Meta-epidemiology (broad) | 0.001 | 0.000 |
| Bibliometrics | 0.001 | 0.000 |
| Science and technology studies | 0.000 | 0.001 |
| Scholarly communication | 0.000 | 0.000 |
| Open science | 0.002 | 0.001 |
| Research integrity | 0.001 | 0.002 |
| Insufficient payload (model declined to judge) | 0.000 | 0.000 |
Machine scores (provisional)
The two teacher heads of the student model, read on this work. A score orders the frame for review; it never asserts a category, and the validation status ships verbatim with every row.
Baseline scores from an immature model (maturity gate not passed, 7 training rounds). Scores rank; they never assert a category.
score_only:v0-immature-baseline · verbatim from the scoring run: score_only means the number may rank works, and no category label ships from itClassification
machine, unvalidatedMachine predicted; a candidate call from one teacher head, not a consensus.
How this classification was reached, model by model and score by score, is at the end of the page under "How this classification was reached".