ECONOMIC GROWTH AND INCOME INEQUALITY IN ASEAN-5 COUNTRIES
By : Yola Mairina Sari
NPM : 1801201010008
Supervisor I : Dr. Aliasuddin, S.E., M.Si.
Supervisor II : Dr. Vivi Silvia, S.E., M.Si.
This study aims to analyze the effect of economic growth, inflation, and expenditure on income in ASEAN-5 by using the ARDL panel analysis model. The data panel in this study is from 1985-2019 and covers five countries for 175 observations. The results of this study indicate that in the long-run economic growth and inflation harm income while government spending is positive with concerns. Meanwhile, economic growth, inflation, and government spending are positive with concerns in the short term. This study recommends that the government to increase inflation through the influence of interest rates to inhibit economic growth so as to reduce concerns. In addition, the government is expected to increase government spending through increased subsidies and social transfers, as well as health spending which can directly reduce income. The government must also increase economic growth to make people's welfare can be achieved evenly.
Keywords: ARDL, Gini ratio, GDP, Government expenditure, Inflation