The Impact of a Monetary Policy Shock to the Trade Balance: An Indonesian Case

NADILA TRISIE A, Sekar Utami Setiastuti, S.E., M.Sc., Ph.D.

2020 | Skripsi | S1 ILMU EKONOMI

Defisit transaksi berjalan yang berkepanjangan telah menjadi ancaman bagi Indonesia selama bertahun-tahun. Salah satu upaya Bank Indonesia untuk mengatasi defisit adalah melalui kebijakan moneter kontraktif. Dalam hal ini, defisit neraca perdagangan memainkan peran penting dalam defisit transaksi berjalan di Indonesia. Oleh karena itu, penelitian ini menyelidiki dampak goncangan moneter kontraktif terhadap kinerja neraca perdagangan. Memanfaatkan Structural Vector Error Correction Model (SVECM) yang terdiri dari restriksi sementara dan permanen, ditemukan bahwa dampak guncangan kebijakan moneter kontraktif terhadap kinerja neraca perdagangan adalah negatif karena asumsi apresiasi pada nilai tukar nominal pada jangka pendek. Selain itu, kejadian ini disebabkan oleh dominasi "Expenditure Switching Effect". Namun, dalam jangka panjang, jumlah ekspor dan impor akan menyesuaikan dengan tingkat harga yang lebih rendah yang menyebabkan barang-barang domestik lebih terjangkau yang mengarah pada peningkatan neraca perdagangan. Temuan lain menegaskan bahwa kebijakan moneter kontraktif menghasilkan Price Puzzle dan Liquidity Puzzle.

A prolonging current account deficit has been a threat to Indonesia for years. One of Bank Indonesia's attempts to overcome the deficit is through a contractionary monetary policy. In this case, the trade balance deficit plays a significant role in the current account deficit in Indonesia. Therefore, this study investigates the impact of a contractionary monetary shock towards the performance of the trade balance. Utilizing the Structural Vector Error Correction Model (SVECM) that comprises transitory and permanent restrictions, it discovered that the impact of the contractionary monetary policy shock towards the performance of the trade balance is negative due to the assumption of an appreciation on the nominal exchange rate in the short run. In addition, this occurrence is due to the dominance of the "Expenditure Switching Effect". However, in the long run, the quantity of exports and imports would adjust to the lowering price level that causes domestic goods to be more affordable which leads to the rise of trade balance. Other evidence affirms that the contractionary monetary policy results in a price puzzle and liquidity puzzle.

Kata Kunci : Trade balance, current account, contractionary monetary shock, income absorption effect, expenditure switching effect, Indonesia, Structural Vector Error Correction Model