Analysis of Granger Construction Between Debt Sovereign and Gross Domestic Product in Indonesia

Abstract

One of the indicators of the country's economy can be seen from the success of economic development which can be explained by state income or Gross Domestic Product (GDP) . However, Indonesia as a developing country has a main concept in improving the economy by means of a sovereign debt system, a concept that is believed to be an accelerator capable of stimulating GDP to remain in an ideal position. To find out the influence between sovereign debt and Indonesia's GDP. Quantitative study using Granger Causality method. Indonesian state objects with variables GDP, inflation and government expenditure. The results showed that the equation between GDP and government expenditure significantly had a causality relationship each having a probability value of 0.049 and 0.002. On the other hand GDP and Debt have a causality relationship with a probability value of 0.045