Lembaga Penyelidikan Ekonomi dan Masyarakat – Fakultas Ekonomi dan Bisnis – Universitas Indonesia

Global Pandemic 2020: Indonesia’s Output Gap and Middle-Income Trap Scenario

Senin Januari 18th, 2021

Abstract

This paper showed that Indonesia’s output-gap has been improving since 2007 until the global pandemic hit Indonesia in 2020. The ultimate indicator for this improvement was the constant decrease in open unemployment. Okun’s Law calculation proved that Indonesia’s actual economic growth was higher than minimum economic growth to generate jobs. This paper also confirmed the Phillips Curve phenomenon that actual inflation was higher than expected inflation.  Indonesia’s average economic growth from 2007–2019 has increased above its natural long-run economic growth level. The global pandemic decreased Indonesia’s economic growth and increased its open unemployment rate in 2020. Indonesia’s economy needs an adjustment which depends on the pandemic containment. This adjustment will be affecting Indonesia’s scenario in avoiding the Middle-Income Trap before 2040 regarding the end of the demographic bonus era. This paper attempts to estimate the impact of the global pandemic on the economy, referring to the Spanish Flu’s impact on the global trade openness and how Indonesia adjusts its economy in the short-run and navigates its economic transformation in the long-run.

Download (PDF, 1.57MB)

Recent Post

Mengatasi Penurunan Tanah dan Krisis Air di Jakarta – Environmental Policy Update Volume 1 No. 3.

Kamis Mei 16th, 2024

Ilusi Pertumbuhan yang Stabil: Indonesia Economic Outlook Q2-2024

Selasa Mei 7th, 2024

Seri Analisa Makroekonomi: Inflasi Bulanan, Mei 2024

Selasa Mei 7th, 2024

Tantangan Produktivitas Pekerja Indonesia (Labour Market Brief, April 2024)

Selasa April 30th, 2024

Related Post

penurunan tanah

Kamis Mei 16th, 2024

Mengatasi Penurunan Tanah dan Krisis Air di Jakarta – Environmental Policy Update Volume 1 No. 3.

Selasa Mei 7th, 2024

Ilusi Pertumbuhan yang Stabil: Indonesia Economic Outlook Q2-2024

Selasa Mei 7th, 2024

Seri Analisa Makroekonomi: Inflasi Bulanan, Mei 2024