Relationship of International Trade and Energy Consumption to Economic Growth in Indonesia 1980 – 2014

Abstract

International trade and energy consumption are factors that can increase economic growth. Indonesia’s exports decreased while Indonesian imports increased. In addition, Indonesia’s primary energy consumption is increasing every year causing the availability of primary energy to decline. The purpose of the research is to know the relationship between exports and energy consumption to Indonesia’s economic growth in the long term and short term. This research use Error Correction Model (ECM) with period 1980 to 2014. The result of this research is that export has a significant positive relationship to economic growth on long-term and short-term. Energy consumption has a significant positive relationship to economic growth on long-term and short-term.