Government Bonds and Central Bank Assets in Global Crisis Mitigation Efforts in Indonesia
This study investigates the integrated effectiveness of government bonds and central bank assets within Indonesia's policy mix for mitigating global crises, an area often examined in isolation. Our primary objective is to quantify the short and long-run impacts of these instruments on Indonesi...
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| Format: | Article |
| Language: | English |
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Jurusan Ekonomi Pembangunan Fakultas Ekonomi Universitas Sriwijaya
2025-06-01
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| Series: | Jurnal Ekonomi Pembangunan |
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| Online Access: | https://jep.ejournal.unsri.ac.id/index.php/jep/article/view/23286 |
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| author | Chenny Seftarita Suriani Ferayanti Fitriyani Asri Diana |
| author_facet | Chenny Seftarita Suriani Ferayanti Fitriyani Asri Diana |
| author_sort | Chenny Seftarita |
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This study investigates the integrated effectiveness of government bonds and central bank assets within Indonesia's policy mix for mitigating global crises, an area often examined in isolation. Our primary objective is to quantify the short and long-run impacts of these instruments on Indonesia's economic growth during periods of global economic turbulence. Utilizing quarterly data spanning 2009 to 2021, we employ an Autoregressive Distributed Lag (ARDL) model. Empirical results reveal that both government bonds and central bank assets positively influence economic growth in both the short and long run. In the short run, these instruments are effective in stimulating economic activity and cushioning the immediate impacts of a global crisis. However, the long-run analysis indicates that while their supportive role persists, over-reliance, particularly through sustained fiscal deficits, can lead to a weakening of macroeconomic performance. Practical implications—prudent and balanced management of fiscal and monetary policies is essential to ensure long-term economic stability. Improving the quality of public spending is essential in strengthening debt governance, and encouraging close collaboration between fiscal and monetary authorities to optimize crisis mitigation strategies and promote sustainable growth.
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| format | Article |
| id | doaj-art-5e8560c2a6a6431b8f46b91fe58b1fd9 |
| institution | Kabale University |
| issn | 1829-5843 2685-0788 |
| language | English |
| publishDate | 2025-06-01 |
| publisher | Jurusan Ekonomi Pembangunan Fakultas Ekonomi Universitas Sriwijaya |
| record_format | Article |
| series | Jurnal Ekonomi Pembangunan |
| spelling | doaj-art-5e8560c2a6a6431b8f46b91fe58b1fd92025-08-20T03:29:04ZengJurusan Ekonomi Pembangunan Fakultas Ekonomi Universitas SriwijayaJurnal Ekonomi Pembangunan1829-58432685-07882025-06-0123110.29259/jep.v23i1.23286Government Bonds and Central Bank Assets in Global Crisis Mitigation Efforts in IndonesiaChenny Seftarita0https://orcid.org/0000-0003-0727-0743Suriani1https://orcid.org/0000-0002-4937-9141Ferayanti2https://orcid.org/0009-0006-9759-9428Fitriyani3https://orcid.org/0000-0003-0835-1625Asri Diana4https://orcid.org/0000-0002-5847-030XDepartment of Development Economics, Faculty of Economics and Business, Universitas Syiah Kuala, Aceh, IndonesiaDepartment of Development Economics, Faculty of Economics and Business, Universitas Syiah Kuala, Aceh, IndonesiaDepartment of Development Economics, Faculty of Economics and Business, Universitas Syiah Kuala, Aceh, IndonesiaDepartment of Development Economics, Faculty of Economics and Business, Universitas Syiah Kuala, Aceh, IndonesiaDepartment of Development Economics, Faculty of Economics and Business, Universitas Syiah Kuala, Aceh, Indonesia This study investigates the integrated effectiveness of government bonds and central bank assets within Indonesia's policy mix for mitigating global crises, an area often examined in isolation. Our primary objective is to quantify the short and long-run impacts of these instruments on Indonesia's economic growth during periods of global economic turbulence. Utilizing quarterly data spanning 2009 to 2021, we employ an Autoregressive Distributed Lag (ARDL) model. Empirical results reveal that both government bonds and central bank assets positively influence economic growth in both the short and long run. In the short run, these instruments are effective in stimulating economic activity and cushioning the immediate impacts of a global crisis. However, the long-run analysis indicates that while their supportive role persists, over-reliance, particularly through sustained fiscal deficits, can lead to a weakening of macroeconomic performance. Practical implications—prudent and balanced management of fiscal and monetary policies is essential to ensure long-term economic stability. Improving the quality of public spending is essential in strengthening debt governance, and encouraging close collaboration between fiscal and monetary authorities to optimize crisis mitigation strategies and promote sustainable growth. https://jep.ejournal.unsri.ac.id/index.php/jep/article/view/23286Government bondsCentral bank assetsEconomic growthCrisis mitigation |
| spellingShingle | Chenny Seftarita Suriani Ferayanti Fitriyani Asri Diana Government Bonds and Central Bank Assets in Global Crisis Mitigation Efforts in Indonesia Jurnal Ekonomi Pembangunan Government bonds Central bank assets Economic growth Crisis mitigation |
| title | Government Bonds and Central Bank Assets in Global Crisis Mitigation Efforts in Indonesia |
| title_full | Government Bonds and Central Bank Assets in Global Crisis Mitigation Efforts in Indonesia |
| title_fullStr | Government Bonds and Central Bank Assets in Global Crisis Mitigation Efforts in Indonesia |
| title_full_unstemmed | Government Bonds and Central Bank Assets in Global Crisis Mitigation Efforts in Indonesia |
| title_short | Government Bonds and Central Bank Assets in Global Crisis Mitigation Efforts in Indonesia |
| title_sort | government bonds and central bank assets in global crisis mitigation efforts in indonesia |
| topic | Government bonds Central bank assets Economic growth Crisis mitigation |
| url | https://jep.ejournal.unsri.ac.id/index.php/jep/article/view/23286 |
| work_keys_str_mv | AT chennyseftarita governmentbondsandcentralbankassetsinglobalcrisismitigationeffortsinindonesia AT suriani governmentbondsandcentralbankassetsinglobalcrisismitigationeffortsinindonesia AT ferayanti governmentbondsandcentralbankassetsinglobalcrisismitigationeffortsinindonesia AT fitriyani governmentbondsandcentralbankassetsinglobalcrisismitigationeffortsinindonesia AT asridiana governmentbondsandcentralbankassetsinglobalcrisismitigationeffortsinindonesia |