Faculty of Economics and Business

Sampai saat ini, korupsi merupakan salah satu masalah terbesar yang dihadapi oleh bangsa Indonesia dan membawa dampak yang tidak hanya merugikan keuangan negara, tetapi juga merupakan pelanggaran hakhak sosial dan ekonomi masyarakat, menggerogoti kesejahteraan dan demokrasi, merusak aturan hukum, dan memundurkan pembangunan. Berbagai upaya telah dilakukan dalam mengatasi korupsi di Indonesia. Namun demikian, berbagai upaya tersebut cenderung masih dilakukan secara parsial dan tidak memiliki desain strategi yang jelas. Dampaknya kemudian, berbagai upaya tersebut belum mampu mengurangi secara signifikan besaran tindak pidana korupsi yang terjadi di Indonesia. Masih parsialnya berbagai upaya yang dilakukan juga dapat dilihat dari belum diperhatikan dan dikajinya secara mendalam peranan akuntabilitas publik dan partisipasi masyarakat yang sebenarnya merupakan instrumen penting dari berbagai strategi pemberantasan korupsi. Berangkat dari uraian tersebut, tulisan ini mencoba untuk memberikan gambaran mengenai pentingnya akuntabilitas publik dan partisipasi masyarakat sebagai salah satu instrumen dalam pemberantasan korupsi di Pemerintahan dari berbagai perspektif teori yang ada.

This paper analyzes whether the expansionary fiscal policy funded by issuing debt instruments in financial markets will increase short-term interest rates. If  the expansionary fiscal policy increases interest rates, which decrease private spending especially investment, crowding out occurs. This is interesting because global economic crisis has encouraged many countries to run large budget deficits to stimulate the economy. Indonesia has also run budget deficit during this crisis and even in years before. The impact of such a policy can be significant because Indonesia’s debt market is still narrow and shallow. Therefore, its capability of absorbing the government debt instruments without influencing the private sector funding is limited. This study tests whether the crowding out occurs in Indonesia using a time series econometric model inspired by Cebula and Cuellar’s model. The Cointegration Regression and Error Correction Model (ECM) are used in this study. Monthly data from Apr...

Despite having emerged for just some years, the development and growth of the digital-based economy in Indonesia is exponential. This study uses the Purposive Random Sampling and Descriptive Analyses method to assess the developments of the digital-based economy in several provinces in Indonesia. The Java-Bali region is more advanced in its digital-based economy compared to other provinces in Indonesia due to its infrastructure, human resources, and government policies which are more supportive. The inequalities between provinces remain a concern for it may directly correlate to a corresponding increase in disparity. Digital-based economy, if it is well-equipped with infrastructure and well-supported by local government, may serve as a balm given its potential as a tool to raise prosperity and equality in society. It will help prepare and equip those in remote rural areas, known as the bottom of the pyramid.

The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate.

Using aggregate and bank-level data for several countries, the paper studies what happens to the banking system following a banking crisis. Crises are not accompanied by a significant decline in aggregate bank deposits relative to GDP, although depositors leave weaker banks for stronger ones. Credit slows substantially, but the credit-to-GDP ratio is higher after the crisis. Output recovery begins in the second year after the crisis while credit still stagnates. Banks, including healthier ones, reallocate their asset portfolio away from loans, suggesting a lack of loan demand or collateral. Banks also improve their cost efficiency.

This paper provides the first comprehensive econometric analysis of the causes of bank distress during the Depression. We assemble bank-level data for Fed member banks, and combine those data with countylevel, state-level, and national-level economic characteristics to capture cross-sectional and inter-temporal variation in the fundamental determinants of bank failure. We find that fundamentals explain most of the incidence of bank failure, and argue that "contagion" or "liquidity crises" were a relatively unimportant influence on bank failure risk prior to 1933. At the national level, we find that the first two banking crises identified by Friedman and Schwartz in 1930 and 1931 are not associated with positive unexplained residual failure risk, or with changes in the importance of liquidity measures for forecasting bank failures. The third banking crisis they identify is a more ambiguous case, but even if one views it as a bona fide liquidity crisis, the size of the contagion effect could not have been very large. The last banking crisis they identify -at the beginning of 1933 -is associated with important, unexplained increases in bank failure risk. We also investigate the potential role of regional or local contagion and illiquidity for promoting bank failure and find some evidence in support of such effects, but these are of small importance in the aggregate.

This paper considers the joint role of macroeconomic, structural and bank-specific factors in explaining the occurrence of banking problems in the nineteen Eastern European transition countries over the last decade. With data at the individual bank level we show, using a discrete time survival model, that all three factors interact in their impact and have a rich dynamic profile, which underlines the highly volatile cycles challenging the stability of banks in this region. A fragile funding basis accompanied by high exposure to market risk in an environment of reforms and macroeconomic disturbances is the typical precursor of bank distress.

This paper assesses the extent to which stock market information may assist bank regulators in the identification of bank financial distress. The research identifies a variety of stock return and other market related variables that might contain elements of longerterm trends capable of anticipating changes in regulator ratings of bank and thrift financial health. Univariate tests confirm a remarkable tendency for market related variables to decline, or otherwise move, far in advance of formal regulator rating downgrades, suggesting that these variables may have useful predictive content.

Since 1990, the banking sector has experienced enormous legislative, technological and financial changes, yet research into the causes of bank distress has slowed. One consequence is that traditional supervisory surveillance models may not capture important risks inherent in the current banking environment. After reviewing the history of these models, we provide empirical evidence that the characteristics of failing banks have changed in the last ten years and argue that the time is right for new research employing new empirical techniques. In particular, dynamic models that utilize forward-looking variables and address various types of bank risk individually are promising lines of inquiry. Supervisory agencies have begun to move in these directions, and we describe several examples of this new generation of early-warning models that are not yet widely known among academic banking economists.

Financial stability in Europe has received renewed attention with the advent of a common currency, wave of mergers and acquisitions among financial institutions, and greater market competition (e.g. ECB, 1999; IMF, 1999; OECD, 1999). This paper examines whether EU country banking systems are particularly vulnerable to systemic risk at present. Our approach is to examine episodes of banking sector distress for a large sample of countries, highlighting the experience of the EU. We estimate multivariate probit models linking the likelihood of banking problems to a set of macroeconomic variables and institutional characteristics. Institutional characteristics, made available by a new data set on corporate governance in the financial sector not previously used in this type of analysis, include aspects of bank supervision and regulation, restrictions on bank portfolios, and development of the banking system. Given these characteristics, the model predicts a low probability of banking sector distress in EMU countries.

The aim of this paper is to assess the extent to which stock market information can be used to estimate leading indicators of bank financial distress. This issue is of importance because of the increased emphasis on market forces by the Basel II committee (pillar 3). We specify a Logit early warning model, designed for European banks, which is used to test if market based indicators add predictive value to models relying on accounting data. Tests are also conducted to study the robustness of the link between market information and financial downgrading in the light of the too-big-too-fail (safety net) and the bank opacity (asymmetric information) hypotheses. Whereas some of our results support the use of market related indicators (in line with those previously obtained in the literature), we show that the accuracy of the predictive power is dependent on the extent to which bank liabilities are market traded. For banks which heavily rely on (insured) deposits, the market seems unable to convey useful information and the amount of subordinated debt issued by banks does not contribute to any improvement in the expected link.

Financial stability in Europe has received renewed attention with the advent of a common currency, wave of mergers and acquisitions among financial institutions, and greater market competition (e.g. ECB, 1999; IMF, 1999; OECD, 1999). This paper examines whether EU country banking systems are particularly vulnerable to systemic risk at present. Our approach is to examine episodes of banking sector distress for a large sample of countries, highlighting the experience of the EU. We estimate multivariate probit models linking the likelihood of banking problems to a set of macroeconomic variables and institutional characteristics. Institutional characteristics, made available by a new data set on corporate governance in the financial sector not previously used in this type of analysis, include aspects of bank supervision and regulation, restrictions on bank portfolios, and development of the banking system. Given these characteristics, the model predicts a low probability of banking sector distress in EMU countries.

Size matters in banking. In this paper, we explore whether shocks originating at large banks affect the probability of distress of smaller banks and thus the stability of the banking system. Our analysis proceeds in two steps. In a first step, we follow Gabaix [Gabaix, X., 2008a. The Granular Origins of Aggregate Fluctuations. Available at SSRN: http://ssrn.com/abstract=1111765] and construct a measure of idiosyncratic shocks at large banks, the so-called Banking Granular Residual. This measure documents the importance of size effects for the German banking system. In a second step, we incorporate this measure of idiosyncratic shocks at large banks into an integrated stress-testing model for the German banking system following De Graeve et al. (2008). We find that positive shocks at large banks reduce the probability of distress of small banks.