ISLAMIC MONETARY POLICY AND ITS IMPACT ON REAL SECTOR

  • Isnaeni Octaviani Universitas Islam Negeri Syarif Hidayatullah Jakarta
  • Mohammad Nur Rianto Al Arif Universitas Islam Negeri Syarif Hidayatullah Jakarta

Abstract

The essence of the Islamic economic system is strengthening the real sector. This research aims to analyze the effect of Islamic monetary instrument (such as SBIS, PUAS and Islamic bank financing in the real sector. This research uses the Vector Error Correction Model (VECM) as a method of analysis. The finding revealed that based on the VECM estimation test, in the long term SBIS and Islamic bank financing has a positive effect on the Industrial Production Index (IPI). Meanwhile, PUAS has an adverse effect toward Industrial Production Index (IPI). Besides, based on impulse response function (IRF) test, the shock of SBIS and PUAS responded positively by Industrial Production Index (IPI). Then based on the result of FEVD test, the variable of PUAS in the model of this research has the most significant contribution toward Industrial Production Index (IPI).

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Published
Dec 31, 2018
How to Cite
OCTAVIANI, Isnaeni; AL ARIF, Mohammad Nur Rianto. ISLAMIC MONETARY POLICY AND ITS IMPACT ON REAL SECTOR. TRIKONOMIKA, [S.l.], v. 17, n. 2, p. 43-48, dec. 2018. ISSN 2355-7737. Available at: <https://journal.unpas.ac.id/index.php/trikonomika/article/view/1144>. Date accessed: 23 jan. 2021. doi: http://dx.doi.org/10.23969/trikonomika.v17i2.1144.