The Effect of Gross Domestic Product, Government Military Expenditure on Foreign Investment in ASEAN Countries

Khairul Rizqiah; Simon  Julianus Pardede; Guntur Eko Saputro; Sri Iswati; Suwito Suwito

doi:10.55227/ijhess.v4i5.1486

Authors

Khairul Rizqiah Defense Economics Department, Faculty of Defense Management University of Defense
Simon Julianus Pardede Defense Economics Study Program, University of Defense
Guntur Eko Saputro Defense Economics Study Program, University of Defense
Sri Iswati Defense Economics Study Program, University of Defense
Suwito Suwito Defense Economics Study Program, University of Defense

DOI:

https://doi.org/10.55227/ijhess.v4i5.1486

Keywords:

sean, Economy Defense, FDI, GDP, Military Expenditure

Abstract

The purpose of this study is to see the impact of Gross Domestic Product, Military Expenditure on Foreign Direct Investment in ASEAN countries. The results of this study show that GDP has a negative influence on foreign investment and the increase or decrease of Milex significantly affects foreign direct investment according to the political stability in each country. In some countries, it is said that increasing Milex does not necessarily make a country safer. An increase in Milex can occur when conflicts in a country or region increase and as a result investor confidence decreases. Whereas in other countries with higher political stability, descriptive statistics of military spending are used in this study and the data used in this study are from SIPRI, Word Bank, and data from the financial statements of ASEAN countries. Before the analysis, the constant value is, meaning that if the independent variable Milex is equal to zero, then the dependent variable (Foreign Investment) will have a value of 10.58533. The regression coefficient value of GDP (X1) is -0.180875 and Milex (X2) is 0.541519 and has a positive sign which means that if Milex increases by 1 unit, the dependent variable, namely Foreign Direct Investment, will also increase by 0.180875 and vice versa. it shows that the Jarque-Bera value is 67.16348 with a probability of 0.00000. The output result of the Adjusted R-Square value is 0.872961, or 87.29%.

Author Biographies

Simon Julianus Pardede, Defense Economics Study Program, University of Defense

post-graduate students

Guntur Eko Saputro, Defense Economics Study Program, University of Defense

Dosen

Sri Iswati, Defense Economics Study Program, University of Defense

dosen

Suwito Suwito, Defense Economics Study Program, University of Defense

dosen

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