Bulletin of Islamic Economics

Analysis of the Effect of GRDP per Capita, Open Unemployment Rate, and Provincial Capital Dummy on Poverty Levels in Regency/City in Java Island in 2023

Vriska Ayuning Tias — 2025-12-30

Poverty is a fundamental challenge that hinders national progress, negatively affecting social and economic aspects. This study analyzes the effect of Gross Regional Domestic Product (GRDP) per capita, Open Unemployment Rate, and provincial capital status on the poverty rate in regencies/municipalities in Java Island in 2023. Using cross-sectional data from 119 districts/municipalities and the Ordinary Least Squares (OLS) regression method with robust standard errors, it is found that GRDP per capita and provincial capital status have a negative and significant effect on the poverty rate. In contrast, Open Unemployment Rate has a positive and significant effect on the poverty rate. The logarithmic model used shows consistency with economic theory and explains 52.22% of the variation in poverty rates. The findings suggest that inclusive economic growth, job creation, and equitable development outside provincial capitals are essential to reduce poverty in Java.

The Relationship between Exchange Rate, Money Supply, and Inflation in Indonesia: An ARDL Approach

Refika Cyntia Sari — 2025-12-30

This study examines the short- and long-term relationships between inflation, exchange rate, and money supply (M2) in Indonesia using the Autoregressive Distributed Lag (ARDL) approach over the period 2013–2024. Monthly time-series data obtained from official sources are analyzed to capture the dynamic interactions among variables. The bounds testing procedure confirms the existence of a long-run cointegration relationship, with the ARDL(5,1,2) model identified as the optimal specification. Empirical results indicate that, in the short run, inflation is significantly influenced only by its own past values, while the exchange rate and money supply are statistically insignificant in both the short and long term. These findings suggest that inflation dynamics in Indonesia are primarily driven by internal adjustment mechanisms rather than direct monetary or exchange rate shocks. The study contributes to monetary policy analysis by highlighting the importance of inflation expectations and domestic stability.

Dynamics of Economic Growth on The Island of Sumatra Before and After The Covid-19 Pandemic: Panel Data Analysis

Hadraji Mufti Abizar Al Ghiffari — 2025-12-30

This study aims to analyze the influence of inflation, investment, and government spending on economic growth on the island of Sumatra during the period 2017–2023. Using the panel data regression method, this study combines interprovincial and intertemporal data variations to obtain a more comprehensive picture of economic dynamics before and after the COVID-19 pandemic. The results of the analysis show that simultaneously the three variables have a significant influence on regional economic growth. Partially, investment has proven to have a positive and significant influence so that it is the main factor driving economic growth, especially in the post-pandemic recovery phase. Inflation also shows a positive and significant influence, which indicates that price stability is able to support regional economic activity. Meanwhile, government spending has a positive but insignificant effect, so the effectiveness of regional fiscal allocation still needs to be improved in order to be able to have a stronger economic impact. Overall, these findings confirm that creating a conducive investment climate and improving the quality of government spending are key to encouraging sustainable economic growth on the island of Sumatra.

The Effect of Digital Transactions, Interest Rates, and the COVID-19 Pandemic on the Money Supply in Indonesia (2018-2023)

Isnaini Nur Fadilah — 2025-12-30

This study analyzes the effect of digital transactions, interest rates, and the COVID-19 pandemic on the money supply (M2) in Indonesia from August 2018 to August 2023. Using monthly time series data from Bank Indonesia, BPS, and Katadata, the research employs multiple linear regression with the Ordinary Least Squares (OLS) method. The results show that digital transactions have a positive and significant effect on the money supply, indicating that the digitalization of financial systems accelerates the circulation of money in the economy. Meanwhile, the benchmark interest rate has no significant direct effect on M2, suggesting that its traditional role in monetary control may be diminishing in the digital era. The COVID-19 pandemic dummy variable shows a positive and significant impact on the money supply, reflecting the effects of fiscal and monetary stimulus policies during the crisis. Overall, the findings highlight that technological transformation and crisis conditions substantially influence liquidity dynamics, and that monetary policy must adapt to digital and structural economic changes.

Contribution of Government Expenditure and Distribution of Zakat, Infaq, Sadaqah (ZIS) Funds to Poverty Alleviation in Central Java Province

Khofifah Ghomzah — 2025-12-30

Poverty is a worldwide concern that must be handled, especially in developing countries like Indonesia, which has serious poverty issues. One of the provinces in Indonesia with a high poverty rate is Central Java Province. This study aims to determine the effect of government expenditures on education, health, and social welfare, as well as the distribution of ZIS funds on poverty in Central Java Province for the period 2017-2024. The data used in this study is time series data that has been processed using the ECM method with the help of E-Views 12 software. The results show that in the long term, government expenditure on education, government expenditure on social welfare, and ZIS funds have a negative and significant effect on poverty. Meanwhile, government expenditure on health has positive and significant on poverty. In the short term, government expenditure on education has no effect on poverty. Government expenditure on health has a positive and significant effect on poverty. Government expenditure on social welfare and the distribution of ZIS funds have a negative and significant effect on poverty.