The Effect of Investment and Unemployment Rate on Economic Growth in Indonesia

S. Hasdiana; Rahmatia Rahmatia; Fatmawati Fatmawati; Anas Iswanto

doi:10.2991/978-94-6463-758-8_18

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The Effect of Investment and Unemployment Rate on Economic Growth in Indonesia

Authors

S. Hasdiana¹^{, 2}^{, *}, Rahmatia Rahmatia², Fatmawati Fatmawati², Anas Iswanto²

¹Economics Doctoral Program Student, Postgraduate Faculty of Economics and Business, Hasanuddin University, Makassar, Indonesia

²Faculty of Economics and Business, Hasanuddin University, Makassar, Indonesia

^*Corresponding author. Email: sh22a@student.unhas.ac.id

Corresponding Author

S. Hasdiana

Available Online 30 July 2025.

DOI: 10.2991/978-94-6463-758-8_18 How to use a DOI?
Keywords: Investment; unemployment rate; economic growth; fixed effect model
Abstract: This study aims to analyze the effect of investment and unemployment rates on economic growth in 10 provinces in Indonesia during the period of 2013-2022. The research employs a panel data regression method with a fixed effect model to examine the partial and simultaneous effects between the independent variables, namely investment and unemployment rates, on the dependent variable, economic growth. The partial test results show that investment has a positive and significant effect on unemployment rates but a negative and statistically insignificant effect on economic growth. On the other hand, the simultaneous test results indicate that investment and unemployment rates together have a significant influence on economic growth. This suggests a mismatch in investment allocation, where investments are predominantly directed towards capital-intensive sectors that do not absorb large amounts of labor, as well as the lack of investment effectiveness in driving short-term economic growth.
Copyright: © 2025 The Author(s)
Open Access: Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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Volume Title: Proceedings of the 9th International Conference on Accounting, Management, and Economics 2024 (ICAME 2024)
Series: Advances in Economics, Business and Management Research
Publication Date: 30 July 2025
ISBN: 978-94-6463-758-8
ISSN: 2352-5428
DOI: 10.2991/978-94-6463-758-8_18 How to use a DOI?
Open Access: Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

Cite this article

ris enw bib

TY  - CONF
AU  - S. Hasdiana
AU  - Rahmatia Rahmatia
AU  - Fatmawati Fatmawati
AU  - Anas Iswanto
PY  - 2025
DA  - 2025/07/30
TI  - The Effect of Investment and Unemployment Rate on Economic Growth in Indonesia
BT  - Proceedings of the 9th International Conference on Accounting, Management, and Economics 2024 (ICAME 2024)
PB  - Atlantis Press
SP  - 189
EP  - 203
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-94-6463-758-8_18
DO  - 10.2991/978-94-6463-758-8_18
ID  - Hasdiana2025
ER  -

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