Institute for Economic and Social Research – Faculty of Economics and Business – Universitas Indonesia

Financial crises : impact on central bank independence, output and inflation

February 20, 2014


Abstract

The recent financial crisis has spread to the rest of the world. The impact of the financial crisis on economic activity varies widely across countries, reflecting differences in vulnerability to financial crisis, heterogeneity in macroeconomic structures, and differences in policy responses. This dissertation finds that the impact of the current financial crisis on output and unemployment is related to the flexibility of the labor market. Countries with low hiring cost suffered lower output and employment losses due to the recent financial crisis. With respect to central bank independence, financial crises significantly increase the likelihood that a central bank governor will be replaced. This dissertation also finds that the legal and actual independence of Bank Indonesia diverged substantially before it was mandated as an independent institution. Finally, fiscal deficits and debt crises have a positive, significant and homogenous effect on inflation in the long run.

For full article, click the following link : http://irs.ub.rug.nl/ppn/345606892

Recent Post

The Impact of COVID-19 on Voter Turnout in the 2020 Regional Elections in Indonesia: Do Voters Care About Health Risks?

March 21, 2024

Macroeconomic Analysis Series: BI Board of Governor Meeting, March 2024

March 20, 2024

Dampak Ekonomi Penyelenggaraan Pertunjukan Musik: Konser Taylor Swift dan Coldplay di Indonesia dan Singapura (Trade and Industry Brief, Special Report, Maret 2024)

March 6, 2024

Macroeconomic Analysis Series: Monthly Inflation, March 2024

March 4, 2024

Related Post

July 7, 2017

Indonesia towards 2030 and beyond: A Long-Run International Trade Foresight

February 24, 2014

Industrial Development in Cities

February 24, 2014

Corruption in Indonesia