JDE (Journal of Developing Economies) https://e-journal.unair.ac.id/JDE <p align="justify">JDE (Journal of Developing Economies) is a journal published by the Department of Economics, Faculty of Economics and Business, Universitas Airlangga with the ISSN <a href="https://portal.issn.org/resource/issn/2541-1012" target="_blank" rel="noopener">2541-1012</a> (print version) and <a href="https://portal.issn.org/resource/issn/2528-2018" target="_blank" rel="noopener">2528-2018</a> (online version). This journal is published every 6 months, June and December. All manuscripts received by the editor of <strong>JDE (Journal of Developing Economies)</strong> will be reviewed by peer reviewers according to the field of economics studies (at least 2 people) with <strong>a double-blind peer review policy</strong>. </p> <p align="justify">All submissions should be formatted in accordance with <a href="https://drive.google.com/file/d/1N68I3O2--FsFmWxuV0rt_S_5_AWjfazm/view?usp=sharing">JDE (Journal of Developing Economies) template</a> and through Open Journal System (OJS) only.</p> <p align="justify"> </p> Universitas Airlangga en-US JDE (Journal of Developing Economies) 2541-1012 <p> <img src="/public/site/images/jurnalekonomi/cc_by_lebih_kecil1.png" alt="" /></p><p><span>JDE (Journal of Developing Economies) (p-ISSN: 2541-1012; e-ISSN: 2528-2018) is licensed under a <a href="https://creativecommons.org/licenses/by/4.0/" rel="license">Creative Commons Attribution 4.0 International License</a></span></p><div>Authors who publish with JDE (Journal of Developing Economies) agree to the following terms:</div><div><ol><li>The journal allows the author to hold the copyright of the article without restrictions.</li><li>The journal allows the author(s) to retain publishing rights without restrictions</li><li>The legal formal aspect of journal publication accessibility refers to <span lang="IN">Creative Commons Attribution </span>(CC BY) </li></ol></div> South Africa’s Savings and Economic Development Linkage: Causal Relationship Examination https://e-journal.unair.ac.id/JDE/article/view/40462 <p><em>South Africa dreams of eradicating poverty and achieving equitable distribution of its scarce resources among its citizens by 2030. Economic growth sustained over time is crucial in achieving its developmental goals. Domestic savings provide a cheap source of resources for investment that would sustain economic growth. This study explored the relationship between South Africa’s aggregate national savings and aggregate national income from 1987 to 2021. The study utilized Solow’s bivariate model and error correction-centered causality to ensure the robustness of the study results while testing the relationship between saving and economic growth. The study confirmed that aggregate national saving was positively related to South Africa’s economic growth. In the short run, deviations from the long-run paths were partly corrected in the present period. In addition, the study found aggregate national saving Granger caused short- and long-term economic growth. The general policy recommendation is that the Government of South Africa should remove bottlenecks to aggregate national saving mobilization efforts by implementing pro-saving fiscal and monetary policies. High saving rates will stimulate income growth through investments in productive sectors, reducing poverty and inequality.</em></p> Yohane Soko Copyright (c) 2023 Yohane Soko http://creativecommons.org/licenses/by/4.0 2023-12-03 2023-12-03 8 2 231 243 10.20473/jde.v8i2.40462 Impacts of Taxation on Economic Growth in Africa in 2008-2018 - Panel Data Analysis https://e-journal.unair.ac.id/JDE/article/view/43290 <p><em>The debate over the effectiveness of taxes as a tool for promoting economic growth still needs to be solved, with several studies indicating mixed effects of taxes on economic growth. The purpose of this research is to assess the impact of taxation on economic growth in Africa. The study spans eleven years, from 2008 to 2018, and includes multiple variables for 21 African countries. GDP is a dependent variable used as a proxy for economic growth. Numerous GDP-determining predictors were utilized as independent variables; these variables were categorized into three groups: The supply side consists of human capital (population and literacy rate) and economic activities (trade and services). Demand side variables include consumption, government expenditures, net exports, and gross capital formation. Lastly, taxation variables consist of tax revenue, corporate tax rate, number of tax payments, personal income tax, and taxes on income, profits, and capital gains. The study conducted preliminary tests, including descriptive statistics, correlation matrix, and pooled least square estimations for panel data. Based on the results, all macroeconomic determinants have statistically significant effects on GDP except trade. Tax revenue and corporate tax rate positively affect GDP, while personal income tax rate and tax on income, profit, and capital gain negatively affect GDP. In general, taxation has a favorable effect on the economy of African countries because emerging countries use taxation as an internal key to generate revenue and improve economic growth.</em></p> Mercy Kessy Ni Made Sukartini Copyright (c) 2023 Mercy Kessy, Ni Made Sukartini http://creativecommons.org/licenses/by/4.0 2023-12-03 2023-12-03 8 2 244 260 10.20473/jde.v8i2.43290 Activity-Based Costing (ABC) in the Manufacturing Industry: A Literature Review https://e-journal.unair.ac.id/JDE/article/view/40426 <p><em>Activity-based costing (ABC) is a way to figure out actual costs. It has become an essential part of both manufacturing and service organizations. This study aims to figure out the effect of the ABC on the manufacturing system. The data was collected from different countries. The method of this study is the systematic Literature Review of the last ten years, 2012-2022. Activities-based costing (ABC) is a good system because it was adopted by many manufacturing businesses to achieve several benefits, including cost ascertainment, which helped them make wise price decisions, cost reduction, which increased profitability, increased productivity, time and resource savings, and improved production quality. Lack of information and inadequate understanding of how to use the ABC system in their company were to blame for companies that did not accelerate its use. Using activity-based costing is effective.</em></p> Abdulmalek Marwan M. Saeed Aristanti Widyaningsih Amgad S. D. Khaled Copyright (c) 2023 Abdulmalek Marwan M. Saeed, Aristanti Widyaningsih, Amgad S. D. Khaled http://creativecommons.org/licenses/by/4.0 2023-12-03 2023-12-03 8 2 261 270 10.20473/jde.v8i2.40426 The Influence of Economic Uncertainty on Food Security and the Moderating Role of Trade Openness in Developing Countries https://e-journal.unair.ac.id/JDE/article/view/47122 <p><em>This research examined the influence of economic uncertainty and the moderating role of trade openness on food security in 58 developing countries from 2012 to 2021. The dynamic panel data from the two-step System GMM was utilized to accomplish this. The findings of this research revealed that economic uncertainty did not exert a significant influence on food security in developing countries. Conversely, trade openness demonstrated a positive and significant effect in enhancing food security. Trade openness strengthened the adverse influence of economic uncertainty on food security in developing countries. The estimation results show trade openness has a significant positive effect of 0.0518, economic uncertainty has a positive but insignificant effect on food security, and Economic uncertainty when moderated by trade openness, shows a significant negative effect of -0.0533. The findings indicate that economic uncertainty does not significantly affect food security in developing countries. However, trade openness positively and significantly influences food security, suggesting that increased trade openness can enhance a country’s food security. The results reveal a significant negative effect when considering both trade openness and economic uncertainty. It implies that implementing policies that reduce trade openness can enhance food security in high economic uncertainty.</em></p> Astria Algifahri Unggul Heriqbaldi Copyright (c) 2023 Astria Algifahri, Unggul Heriqbaldi http://creativecommons.org/licenses/by/4.0 2023-12-03 2023-12-03 8 2 271 284 10.20473/jde.v8i2.47122 Mind the Gap: The Efficiency Convergence of ASEAN Plus Three Economies https://e-journal.unair.ac.id/JDE/article/view/43146 <p><em>This study aims to examine the performance of technical efficiency convergence (Beta and Sigma convergences) of 10 ASEAN economies as well as other three main partners from East Asia, namely China, South Korea, and Japan for the years of 1990-2021, and addresses the determinants of this convergence consisting of foreign direct investment (FDI), export, and import. By using Stochastic Frontier Analysis to estimate technical efficiency as well as panel dynamic of Generalized Methods of Moment (GMM) to test convergence, we found robust findings of convergence moments, both the catching up effect (Beta Convergence) as well as inequality reduction (Sigma Convergence) across the countries. The effect of FDI inflow to the growth of technical efficiency growth is positive. Coupled to this, a higher ratio of export to the GDP affects positively to the efficiency growth by about 14%-26%. In contrast, importing causes diminishing efficiency growth. The effect of FDI is significant in reducing the inequalities of efficiency only in the period of 2006-2021. While export reveals positive significance in affecting efficiency gap, import discourages efficiency gap to enlarge, indicating that import substitution remains unable to be implemented in some countries to obtain efficiency.</em></p> Mohammad Zeqi Yasin Copyright (c) 2023 Mohammad Zeqi Yasin http://creativecommons.org/licenses/by/4.0 2023-12-03 2023-12-03 8 2 285 296 10.20473/jde.v8i2.43146 Effect of Unemployment, Inflation and Foreign Direct Investment on Economic Growth in Sub-Saharan Africa https://e-journal.unair.ac.id/JDE/article/view/47283 <p>This research explores the influence of unemployment, inflation and FDI on GDP growth from 1991 - 2021. To estimate the model's short-run and long-run phases, the ARDL model was utilized. The Granger causality test, the Error Correction Model (ECM) approach, and the cointegration test were all applied during the investigation. GDP growth, FDI, unemployment, and inflation are among the variables considered. According to the results of the stationarity test, GDP growth and inflation (INF) were stationary at the level, whereas unemployment and FDI were stationary at the first difference. The cointegration test results demonstrated that the variables under consideration had a long-run association. The ECM outcomes also found that, while unemployment and inflation have negative effects on GDP growth, FDI has a positive effect. Finally, the Granger causation analyses showed that none of the variable granger cause the other. The finding suggests that the government should implement policies that manage unemployment and inflation while also encouraging FDI inflows to improve GDP growth.</p> Ebou Correa Copyright (c) 2023 Ebou Correa http://creativecommons.org/licenses/by/4.0 2023-12-03 2023-12-03 8 2 297 315 10.20473/jde.v8i2.47283 Ethnic and Religious Tolerance in Indonesia https://e-journal.unair.ac.id/JDE/article/view/46417 <p><em>This research focuses on the factors that influence tolerance in Indonesia. In this study, tolerance is seen from a person's attitude towards religious and ethnic differences. Data used are the results of Sosial Ekonomi Nasional Modul Sosial Budaya dan Pendidikan (Susenas MSBP) survey in 2021 conducted by Badan Pusat Statistik (BPS). This study uses ordinal logistic regression analysis and the results show that demographic factors (residence area and age) and socio-economic factors (education, poverty status, working status, and interaction with others) are the main factors that influence tolerance attitudes in Indonesia. individuals who live in urban areas, are highly educated, and interact with others, are more tolerant in accepting leaders, friends, and activities from different religions and ethnic groups. Older people have a higher tolerance attitude than younger people in accepting leaders of different religions and ethnicities. Poor households are more likely to accept leaders and friends of different religions and ethnicities, but less likely to accept leaders and activities of different ethnicities. The results also show that working individuals are less likely to accept activities from different religions/ethnic groups.</em></p> Agung Wijaksono Copyright (c) 2023 Agung Wijaksono http://creativecommons.org/licenses/by/4.0 2023-12-03 2023-12-03 8 2 316 325 10.20473/jde.v8i2.46417 Credit Crunch and Monetary Policy During Covid-19 Pandemic https://e-journal.unair.ac.id/JDE/article/view/42583 <p>Under crisis conditions, the significant decline in bank credit growth is associated with the credit crunch phenomenon. The ability of the banking system to provide credit in the economy is limited compared to the demand for credit.&nbsp; During the Covid-19 pandemic, credit growth in Indonesia reached its lowest point when compared to the pre-Covid-19 period. However, the causative factor is still ambiguous.&nbsp; Using a credit market disequilibrium model estimated with Maximum Likelihood, this study tested whether the decline in credit during the Covid-19 pandemic was a credit crunch phenomenon.&nbsp; The results of this study show that the parameter of the probability of credit decline during the Covid-19 pandemic is an insignificant credit crunch phenomenon. This means that the estimated demand for credit is less than the excess supply. Thus, the implications for the role of monetary policy by lowering interest rates have been hampered due to the decline in economic activity during the Covid-19 pandemic.</p> M. Rayyan HS Sugiharso Safuan Copyright (c) 2023 M. Rayyan HS, Sugiharso Safuan http://creativecommons.org/licenses/by/4.0 2023-12-03 2023-12-03 8 2 326 339 10.20473/jde.v8i2.42583 Foreign Exchange Market Pressure, Exchange Rate and Trade Balance in Nigeria: Is There Evidence of the J-Curve Effect? https://e-journal.unair.ac.id/JDE/article/view/44656 <p>The paper examined the relationship between the pressure in the exchange market, exchange rate, and trade balance in Nigeria to ascertain whether or not the J-Curve effects exist. The investigation was anchored on the Marshal-Lerner and the J-Curve theories using annual time series data from 1986 to 2021. The Structural Vector Autoregressive (SVAR) technique was employed, and the findings revealed that the pressure in the exchange market exerts a strong contemporaneous positive effect on the exchange rate in the country. Also, the findings showed that the exchange rate has a strong contemporaneous negative effect on the trade balance. Furthermore, the long-run results indicated that the exchange rate has a positive but weak effect on the country’s trade balance. Based on these findings, it was concluded that the relationship that exists among foreign exchange market pressure, exchange rate, and balance of trade suggests the potentiality of the J-Curve effects in the economy. The study recommended that local production of goods and services in Nigeria should be strengthened so that the depreciation of the naira would improve the trade balance. In the event of naira depreciation, domestic consumers could redirect their demand to the consumption of locally produced goods and services. Also, local production, especially in manufacturing and agricultural processing, should be encouraged, and the quality of the products be enhanced for competitive exportation to improve the trade balance in the country. The policy implication is that policymakers can leverage naira depreciation as a policy tool to enhance Nigeria’s balance of trade.</p> David Terfa Akighir Copyright (c) 2023 David Terfa Akighir http://creativecommons.org/licenses/by/4.0 2023-12-03 2023-12-03 8 2 340 363 10.20473/jde.v8i2.44656 The Role of Socioeconomic Determinants on Individual Decision to Quit Smoking: Evidence from Indonesia. https://e-journal.unair.ac.id/JDE/article/view/41636 <p>The Global Adult Tobacco Survey in 2020 shows that Indonesia became the world’s third-highest number of smokers. This is due to the excessive consumption of cigarettes by the Indonesian people and the lack of awareness of the effects of smoking. This study aims to investigate the socioeconomics as an indicator that has a high probability of being a determinant of individual decisions in households to quit smoking and uses the latest Indonesia Family Life Survey (IFLS-5). The Probit approach was used to analyze the most identified factors for preventive ways and propose interventions to address those factors. We find some facts, namely (1) The higher the level of education and income of the individual in the household, the higher the probability of the individual’s decision to quit smoking; (2) unlike cigarette expenditure, the more significant the increase in cigarette expenditure, the lower the individual’s probability of quitting smoking; (3) but, unfortunately, the existence of a non-smoking area does not influence individuals in the household to quit smoking, this also applies to individual smokers who are sick. We also found that several control variables, such as (4) increasing age and marital status (married), had a positive effect on an individual’s decision to quit smoking; (5) individuals who were male had a lower probability of quitting smoking than females. In addition, (6) both individuals with marital status (divorced) and occupation do not affect the decision to quit smoking.</p> Rizkan Muhammad Nursani Copyright (c) 2023 Rizkan Muhammad, Nursani http://creativecommons.org/licenses/by/4.0 2023-12-03 2023-12-03 8 2 364 378 10.20473/jde.v8i2.41636 Urban Defense Index for City Branding: A Case Study of Five Cities in Kalimantan https://e-journal.unair.ac.id/JDE/article/view/44061 <p>This paper proposes a new model of urban security for city branding in Indonesia, which aims to address the gap in city branding indices lacking safety and security factors. The proposed model, the Urban Defense Index <br />(UDI), measures a region’s ability to manage risks and handle security threats in urban areas. The UDI is calculated based on three sub-indices: ThreatsDisruptions- Obstacles- Challenges (TDOC), Posture, and Stability, which use objective and subjective measurements. A case study uses the proposed model to measure five Kalimantan cities’ urban defense readiness levels. The study found that Stability, Posture, and TDOC are essential factors in determining the level of urban defense readiness in the cities. Future research can address the limitations of the UDI model proposed in this study and expand the UDI model to include other factors that affect urban security.</p> Achmad Farid Wadjdi Yan Namora Eko Rahardjo Moh Ibnu Holdun Copyright (c) 2023 Achmad Farid Wadjdi, Yan Namora , Eko Rahardjo , Moh Ibnu Holdun http://creativecommons.org/licenses/by/4.0 2023-12-03 2023-12-03 8 2 379 397 10.20473/jde.v8i2.44061 Healthy Living in Subsidized Houses? Evidence From Indonesia’s FLPP Program https://e-journal.unair.ac.id/JDE/article/view/44743 <p><em>Government policies to encourage homeownership rates for low-income communities (MBR) are implemented through the Housing Finance Liquidity Facility (FLPP) program, executed since 2010. However, more than half of the built subsidized homes need to meet the minimum construction standards and infrastructure requirements that can impact the health quality of their occupants. This study aims to investigate the impact of government support for purchasing subsidized housing from Indonesia’s FLPP program on district/city-level public health. The results of this study indicated that the FLPP program affects home occupancy rates and the FLPP program also has a negative relationship with community morbidity levels in the MBR group. As well, state intervention in the housing sector with the FLPP subsidized housing program can demonstrably improve the quality of public health. This study recommends that the government maintain the FLPP program because, apart from increasing occupancy, it indirectly impacts health quality improvement</em></p> Adhamaski Pangeran Khoirunurrofik Copyright (c) 2023 Adhamaski Pangeran, Khoirunurrofik http://creativecommons.org/licenses/by/4.0 2023-12-03 2023-12-03 8 2 398 411 10.20473/jde.v8i2.44743 Influence of Political Connections and Efficiency on Financial Performance and Its Implications on Firm Value https://e-journal.unair.ac.id/JDE/article/view/47848 <p><em>This research aims to determine the influence of political connections and efficiency on financial performance and their implications for stock value. The research design employed in this study is quantitative research. The population of this study consists of 66 companies in the mining sector listed on the IDX Sector Energy. The sampling technique used in this research is purposive sampling. The data used are secondary data obtained from www.idx.co.id. Hypothesis testing is conducted using Partial Least Square analysis. The results of this study indicate that 1) Political connections have a non-significant positive influence on financial performance; 2) Efficiency has a significant favorable influence on financial performance; 3) Financial performance has a significant favorable influence on company value; 4) Financial performance has a non-significant positive mediating effect on the relationship between political connections and company value; 5) Financial performance has a significant positive mediating effect on the relationship between efficiency and company value.</em></p> Raihan Hazim Elis Mediawati Copyright (c) 2023 Raihan Hazim, Elis Mediawati http://creativecommons.org/licenses/by/4.0 2023-12-03 2023-12-03 8 2 412 430 10.20473/jde.v8i2.47848 Impact of Covid-19 Cases on Inflation in ASEAN https://e-journal.unair.ac.id/JDE/article/view/45863 <p><em>This study is aimed to examine the impact of the total cases of COVID-19, interest rates, and money supply on inflation in ASEAN-5. Using the Panel Vector Error Correction Model (PVECM), the study reveals that the number of COVID-19 cases has a negative impact on inflation in ASEAN-5 both in the short and long run. The higher the total cases, the lower the inflation in the region. This was caused by a shock from the demand aspect due to the large number of people who were not working, so that household income decreased. A decrease in income will certainly impact on a decrease in demand which will affect equilibrium inflation. In addition, some control variables such as interest rates have a negative effect on inflation in the long run. Meanwhile, the money supply has no significant effect on inflation during the pandemic.</em></p> Chindy Roifatin Wulandari Shochrul Rohmatul Ajija Copyright (c) 2023 Chindy Roifatin Wulandari, Shochrul Rohmatul Ajija, SE.,M.Ec http://creativecommons.org/licenses/by/4.0 2023-12-03 2023-12-03 8 2 431 443 10.20473/jde.v8i2.45863 The determinants of sustainable transportation in East Asian countries: Does the moderating role of institutional quality matter https://e-journal.unair.ac.id/JDE/article/view/47633 <p>Transportation has a profound effect on the environment, aggravating air pollution, climate change, and natural resource depletion. Additionally, the construction and maintenance of transportation infrastructure contribute to deforestation and habitat loss. Therefore, the aim of this research is to investigate the correlation between c02 emissions, natural resource depletion, trade, FDI inflow and transportation in a chosen number of eastern Asian countries, with a unique perspective of examining the influence of institutional qualities as a moderator among these factors. The analysis involves the utilization of CS-ARDL and dumitrescu-hurlin causality test to examine the data. The findings suggest that institutional qualities have a positive impact on the relationship between c02 emissions and transportation, reversing the negative association. Additionally, trade has a negative correlation with transportation, this can be explained by the fact that weak institutional quality can lead to corruption and a lack of transparency, which can discourage foreign investment and trade in the transportation sector. On the other hand, resource depletion and FDI inflows affect negatively the transportation services in East Asian countries. Therefore, the study highlights the significance of effective governance, regulation, and management of institutions in promoting better transportation planning and coordination, ultimately leading to sustainable transportation service.</p> Kadir Aden Sadik Aden Dirir Copyright (c) 2023 Kadir Aden, Sadik Aden Dirir http://creativecommons.org/licenses/by/4.0 2023-12-03 2023-12-03 8 2 444 466 10.20473/jde.v8i2.47633