Indonesia's synchronized monetary and fiscal policies boost economic stability and growth
The article explores how monetary and fiscal policies in Indonesia have interacted over the years. By analyzing data from 1974 to 2019, the researchers found that when the central bank tightens money supply, the government tends to reduce spending. They also discovered that in the past, these policies were not well coordinated, but recent efforts have improved their alignment. This suggests that Indonesia has made progress in coordinating monetary and fiscal policies for better economic outcomes.