Did the policy responses influence credit and business cycle co-movement during the COVID-19 crisis? Evidence from Indonesia

Prabheesh, K P (2023) Did the policy responses influence credit and business cycle co-movement during the COVID-19 crisis? Evidence from Indonesia. Economic Analysis and Policy, 78. pp. 243-255. ISSN 0313-5926

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Abstract

This paper examines the responses of credit and business cycle to various policy actions of the Government of Indonesia during the COVID-19 crisis. Specifically, the paper addresses two key questions (1) How do the credit and business cycle behave during the COVID-19 crisis in Indonesia? (2) Do the central bank and government policy responses effectively stabilize the credit and business cycle? Using the concordance Index and DCC-GARCH methodology, we found that the COVID-19 crisis increased Indonesia's credit and business cycle co-movements. Similarly, using the mixed data sampling regression technique, our findings suggest fiscal policy measures and government support help the business cycle revival during the COVID-19 pandemic. However, the monetary policy transmission is weak during the pandemic

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IITH Creators:
IITH CreatorsORCiD
Prabheesh, K Phttps://orcid.org/0000-0001-6323-8217
Item Type: Article
Uncontrolled Keywords: Business cycle; Covid-19; DCC-GARCH; Fiscal policy; Monetary policy; government support
Subjects: Social sciences > Management
Social sciences
Social sciences > Business Finance
Divisions: Department of Liberal Arts
Depositing User: Mr Nigam Prasad Bisoyi
Date Deposited: 26 Nov 2023 11:06
Last Modified: 26 Nov 2023 11:06
URI: http://raiith.iith.ac.in/id/eprint/11759
Publisher URL: https://doi.org/10.1016/j.eap.2023.02.007
OA policy: https://www.sherpa.ac.uk/id/publication/35764
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