The determinant of foreign direct investment across provinces in Indonesia: the role of market size, resources, and competitiveness

The paper aims to analyze the determinants of foreign direct investment (FDI) in Indonesia for the period of 1990-2014, before and after the implementation of the regional autonomy policy. This study used a panel data regression technique throughout 26 province analysis units. Several important fact...

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Main Authors:	Sodik, Jamzani, Sarungu, Jj., Soesilo, Am, Siti Aisyah Tri Rahayu
Format:	Article
Language:	English
Published:	Penerbit Universiti Kebangsaan Malaysia 2019
Online Access:	http://journalarticle.ukm.my/14144/ http://journalarticle.ukm.my/14144/ http://journalarticle.ukm.my/14144/1/jeko_53%283%29-11.pdf

id	ukm-14144
recordtype	eprints
spelling	ukm-141442020-02-07T10:57:39Z http://journalarticle.ukm.my/14144/ The determinant of foreign direct investment across provinces in Indonesia: the role of market size, resources, and competitiveness Sodik, Jamzani Sarungu, Jj. Soesilo, Am Siti Aisyah Tri Rahayu, The paper aims to analyze the determinants of foreign direct investment (FDI) in Indonesia for the period of 1990-2014, before and after the implementation of the regional autonomy policy. This study used a panel data regression technique throughout 26 province analysis units. Several important factors affecting the FDI across the provinces are considered such as market size indicators (GDP and population), resource indicators (labor force and human resources), and competitiveness indicators (electricity, road length, wages, and export). The results show that only two indicators, namely resources and competitiveness, are statistically significant in influencing the FDI inflow across the provinces. The results of this study have several important implications on public policies aimed at attracting foreign direct investments to the provinces in Indonesia. The government must pay more attention to developing and improving the infrastructure, improving the quality of human resources both in formal and non-formal education through training and skills enhancement at productive age (workforce), and determining regional wage through agreement (deliberation) between the regional governments, employers and trade unions. There is also the need for regional governments to facilitate regional exports through export promotion and export training policies for regional entrepreneurs. Penerbit Universiti Kebangsaan Malaysia 2019 Article PeerReviewed application/pdf en http://journalarticle.ukm.my/14144/1/jeko_53%283%29-11.pdf Sodik, Jamzani and Sarungu, Jj. and Soesilo, Am and Siti Aisyah Tri Rahayu, (2019) The determinant of foreign direct investment across provinces in Indonesia: the role of market size, resources, and competitiveness. Jurnal Ekonomi Malaysia, 53 (3). pp. 1-13. ISSN 0127-1962 http://www.ukm.my/fep/jem/content/2019-3.html
repository_type	Digital Repository
institution_category	Local University
institution	Universiti Kebangasaan Malaysia
building	UKM Institutional Repository
collection	Online Access
language	English
description	The paper aims to analyze the determinants of foreign direct investment (FDI) in Indonesia for the period of 1990-2014, before and after the implementation of the regional autonomy policy. This study used a panel data regression technique throughout 26 province analysis units. Several important factors affecting the FDI across the provinces are considered such as market size indicators (GDP and population), resource indicators (labor force and human resources), and competitiveness indicators (electricity, road length, wages, and export). The results show that only two indicators, namely resources and competitiveness, are statistically significant in influencing the FDI inflow across the provinces. The results of this study have several important implications on public policies aimed at attracting foreign direct investments to the provinces in Indonesia. The government must pay more attention to developing and improving the infrastructure, improving the quality of human resources both in formal and non-formal education through training and skills enhancement at productive age (workforce), and determining regional wage through agreement (deliberation) between the regional governments, employers and trade unions. There is also the need for regional governments to facilitate regional exports through export promotion and export training policies for regional entrepreneurs.
format	Article
author	Sodik, Jamzani Sarungu, Jj. Soesilo, Am Siti Aisyah Tri Rahayu,
spellingShingle	Sodik, Jamzani Sarungu, Jj. Soesilo, Am Siti Aisyah Tri Rahayu, The determinant of foreign direct investment across provinces in Indonesia: the role of market size, resources, and competitiveness
author_facet	Sodik, Jamzani Sarungu, Jj. Soesilo, Am Siti Aisyah Tri Rahayu,
author_sort	Sodik, Jamzani
title	The determinant of foreign direct investment across provinces in Indonesia: the role of market size, resources, and competitiveness
title_short	The determinant of foreign direct investment across provinces in Indonesia: the role of market size, resources, and competitiveness
title_full	The determinant of foreign direct investment across provinces in Indonesia: the role of market size, resources, and competitiveness
title_fullStr	The determinant of foreign direct investment across provinces in Indonesia: the role of market size, resources, and competitiveness
title_full_unstemmed	The determinant of foreign direct investment across provinces in Indonesia: the role of market size, resources, and competitiveness
title_sort	determinant of foreign direct investment across provinces in indonesia: the role of market size, resources, and competitiveness
publisher	Penerbit Universiti Kebangsaan Malaysia
publishDate	2019
url	http://journalarticle.ukm.my/14144/ http://journalarticle.ukm.my/14144/ http://journalarticle.ukm.my/14144/1/jeko_53%283%29-11.pdf
first_indexed	2023-09-18T20:06:26Z
last_indexed	2023-09-18T20:06:26Z
_version_	1777407189814607872

The determinant of foreign direct investment across provinces in Indonesia: the role of market size, resources, and competitiveness

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