Effect of Capital Expenditure and Personnel Expenditure on Regional Economic Growth: Empirical evidence from Western Indonesia

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Published: Jun 30, 2019
DOI: https://doi.org/10.35870/emt.v3i1.94
Keywords:
Economic Growth Capital Expenditure Personnel Expenditure Panel Regression Granger causality test

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Nurul Fitri
Program Studi Ekonomi Syariah, Fakultas Ekonomi dan Bisnis Islam, Universitas Islam Negeri Ar-raniry, Banda Aceh
Sasqia Putri
Program Studi Ekonomi Syariah, Fakultas Ekonomi dan Bisnis Islam, Universitas Islam Negeri Ar-raniry, Banda Aceh

Abstract

This study aims to analyze the effect of capital expenditure and personnel expenditure on regional economic growth in western Indonesia. The data used is a panel data of 10 provinces during the period 2008-2015. The econometric models used to analyze the functional relationship of these variables consisted of the fixed effect method of panel regression, and the Granger causality test. The study found that capital expenditure has a positive but not significant effect on regional economic growth. Conversely, personnel expenditure has a positive and significant effect. Granger causality test results indicate a one-way causality from personnel expenditure and capital expenditure to economic growth and from personnel expenditure to capital expenditure.

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How to Cite
Fitri, N., & Putri, S. (2019). Effect of Capital Expenditure and Personnel Expenditure on Regional Economic Growth: Empirical evidence from Western Indonesia. Jurnal EMT KITA, 3(1), 34–41. https://doi.org/10.35870/emt.v3i1.94
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Vol. 3 No. 1 (2019): JANUARY-JUNE 2019
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Articles
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