The Effect of Inflation, Investment, and Unemployment on Economic Growth in Indonesia

Abstract

This study aims to analyze the influence of inflation, investment, and unemployment on economic growth in Indonesia during the period 2005–2024. The study uses a quantitative approach with multiple linear regression methods. Secondary data were obtained from the Central Statistics Agency (BPS), Bank Indonesia, and other relevant agencies. The estimation results show that inflation and investment have a positive and significant effect on economic growth, while unemployment has a significant negative effect on Gross Domestic Product (GDP). The coefficient of determination (R²) value of 0.9857 indicates that variations in economic growth can be strongly explained by these three independent variables. Simultaneously, inflation, investment, and unemployment have been shown to have a significant effect on Indonesia's economic growth. These findings emphasize the importance of price stability, improving investment quality, and reducing unemployment as strategic steps to strengthen national economic growth.