Determinants of Economic Growth in ASEAN-5: A Sharia Economics Analytical Perspective
Abstract
Economic growth in ASEAN countries faces persistent challenges from macroeconomic instability and structural constraints. This study examines labor, inflation, exchange rates, and foreign direct investment (FDI)as determinants of economic growth in the ASEAN-5, namely Indonesia, Vietnam, Malaysia, the Philippines, and Thailand. Employing a quantitative associative method, the research uses panel data from the World Bank period 2004 until 2023 with a total of 100 observations and applies a Fixed Effect Model using Eviews 12. The results indicate that inflation, exchange rates, and FDI significantly determine economic growth, whereas labor does not. The key empirical contribution is to provide robust, country-specific evidence that can guide policymakers in prioritizing macroeconomic stability and investment climate reforms over labor quantity expansion to sustain regional growth. From a Sharia economics perspective, growth must uphold justice, balance, and holistic welfare.
Keywords:
Labor, Inflation, Exchange Rate, Foreign Direct Investment, and Economic Growth
References
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Ribeiro, R. S. M., McCombie, J. S. L., & Lima, G. T. (2020). Does real exchange rate undervaluation really promote economic growth? Structural Change and Economic Dynamics, 52, 408–417. https://doi.org/10.1016/j.strueco.2019.02.005
Sahu, J. P. (2021). Does inflow of foreign direct investment stimulate economic growth? Evidence from developing countries. Transnational Corporations Review, 13(4), 376–393. https://doi.org/10.1080/19186444.2020.1833603
Seraj, M., & Coskuner, C. (2021). Real exchange rate effect on economic growth: comparison of fundamental equilibrium exchange rate and Balassa–Samuelson based Rodrik approach. Journal of Applied Economics, 24(1), 541–554. https://doi.org/10.1080/15140326.2021.1977083
Siddharth, A., Alexiou, C., & Vogiazas, S. (2024). Exchange Rate Regimes in India: Central Bank Interventions and Purchasing Power Parity in the Context of ASEAN Currencies. Economies, 12(4). https://doi.org/10.3390/economies12040096
Sugiyono. (2019). Metode Penelitian Kuantitatif, Kualitatif, Dan R&D. Alfabeta : Bandung.
Usman, K. (2023). The nexus between remittance, exchange rate and economic growth of E7 economies: Frequency domain analysis. Heliyon, 9(11), e21554. https://doi.org/10.1016/j.heliyon.2023.e21554
Asrinda, D., & Setiawati, R. I. S. (2022). Pengaruh Investasi Asing, Ekspor Neto Dan Tenaga Kerja Terhadap Pertumbuhan Ekonomi Indonesia. Equilibrium : Jurnal Ilmiah Ekonomi, Manajemen Dan Akuntansi, 11(2), 50. https://doi.org/10.35906/equili.v11i2.1114
Baerlocher, D., Parente, S. L., & Rios-Neto, E. (2021). Female Labor Force Participation and economic growth: Accounting for the gender bonus. Economics Letters, 200, 109740. https://doi.org/10.1016/j.econlet.2021.109740
Batrancea, L. M. (2023). The Hard Worker, the Hard Earner, the Young and the Educated: Empirical Study on Economic Growth across 11 CEE Countries. Sustainability (Switzerland), 15(22). https://doi.org/10.3390/su152215996
Bibhuti Sarker, F. K. (2020). Nexus between foreign direct investment and economic growth in Bangladesh: an augmented autoregressive distributed lag bounds testing approach. Financial Innovation. https://doi.org/10.3311/PPso.16799
Chontanawat, J. (2020). Dynamic modelling of causal relationship between energy consumption, CO2 emission, and economic growth in SE Asian countries. Energies, 13(24). https://doi.org/10.3390/en13246664
Cylus, J., & Al Tayara, L. (2021). Health, an ageing labour force, and the economy: Does health moderate the relationship between population age-structure and economic growth? Social Science and Medicine, 287(September), 114353. https://doi.org/10.1016/j.socscimed.2021.114353
Garg, D. S., Mittal, D. S., & Garg, A. (2024). Navigating the path for economic resilience and sustainable economic growth: Empirical insight from G-20 nations. Sustainable Futures, 8(October), 100338. https://doi.org/10.1016/j.sftr.2024.100338
Haider, A., Jabeen, S., Rankaduwa, W., & Shaheen, F. (2023). The Nexus between Employment and Economic Growth: A Cross-Country Analysis. Sustainability (Switzerland), 15(15), 1–18. https://doi.org/10.3390/su151511955
Intisar, R. A., Yaseen, M. R., Kousar, R., Usman, M., & Amjad Makhdum, M. S. (2020). Impact of trade openness and human capital on economic growth: A comparative investigation of asian countries. Sustainability (Switzerland), 12(7). https://doi.org/10.3390/su12072930
Johansyah, M. D., Rusyaman, E., Foster, B., Muslihin, K. R. A., & Supriatna, A. K. (2024). Combining Differential Equations with Stochastic for Economic Growth Models in Indonesia: A Comprehensive Literature Review. Mathematics, 12(20). https://doi.org/10.3390/math12203219
Kumari, R., Shabbir, M. S., Saleem, S., Yahya Khan, G., Abbasi, B. A., & Lopez, L. B. (2023). An empirical analysis among foreign direct investment, trade openness and economic growth: evidence from the Indian economy. South Asian Journal of Business Studies, 12(1), 127–149. https://doi.org/10.1108/SAJBS-06-2020-0199
Kusz, B., Kusz, D., Bąk, I., Oesterreich, M., Wicki, L., & Zimon, G. (2022). Selected Economic Determinants of Labor Profitability in Family Farms in Poland in Relation to Economic Size. Sustainability (Switzerland), 14(21). https://doi.org/10.3390/su142113819
Marimuthu, M., Khan, H., & Bangash, R. (2021). Is the fiscal deficit of asean alarming? Evidence from fiscal deficit consequences and contribution towards sustainable economic growth. Sustainability (Switzerland), 13(18). https://doi.org/10.3390/su131810045
Martadinata, M. A. (2022). Analisis Pengaruh Pertumbuhan Penduduk, Tenaga Kerja, Investasi, Dan Inflasi Terhadap Pertumbuhan Ekonomi Kabupaten/Kota Di Provinsi Jawa Tengah Tahun 2015-2019. Diponegoro Journal of Economics, 11(1), 37–45.
Ogujiuba, K., & Mngometulu, N. (2022). Does Social Investment Influence Poverty and Economic Growth in South Africa: A Cointegration Analysis? Economies, 10(9). https://doi.org/10.3390/economies10090226
Olamide, E., Ogujiuba, K., & Maredza, A. (2022). Exchange Rate Volatility, Inflation and Economic Growth in Developing Countries: Panel Data Approach for SADC. Economies, 10(3). https://doi.org/10.3390/economies10030067
Prihadyatama, A. (2024). Panduan Praktis EViews: Konsep dan Contoh Penerapan dalam Penelitian Ekonomi. Widina Media Utama : Bandung.
Rauf, A., Ali, N., Sadiq, M. N., Abid, S., Kayani, S. A., & Hussain, A. (2023). Foreign Direct Investment, Technological Innovations, Energy Use, Economic Growth, and Environmental Sustainability Nexus: New Perspectives in BRICS Economies. Sustainability (Switzerland), 15(18). https://doi.org/10.3390/su151814013
Razia, A., Omarya, M., Razia, B., Awwad, B., & Ruzieh, A. (2023). Examining how unemployment, inflation and their related aspects affected economic growth in Palestine: The period from 1991 to 2020. Heliyon, 9(11), e21081. https://doi.org/10.1016/j.heliyon.2023.e21081
Rehman, A., Cismas, L. M., & Milin, I. A. (2022). “The Three Evils”: Inflation, Poverty and Unemployment’s Shadow on Economic Progress—A Novel Exploration from the Asymmetric Technique. Sustainability (Switzerland), 14(14). https://doi.org/10.3390/su14148642
Retno Tri Vulandari, listya R. (2021). Statistika Dengan Aplikasi Eviews : Referensi Olah data Penelitian. Gava Media : Yogyakarta.
Ribeiro, R. S. M., McCombie, J. S. L., & Lima, G. T. (2020). Does real exchange rate undervaluation really promote economic growth? Structural Change and Economic Dynamics, 52, 408–417. https://doi.org/10.1016/j.strueco.2019.02.005
Sahu, J. P. (2021). Does inflow of foreign direct investment stimulate economic growth? Evidence from developing countries. Transnational Corporations Review, 13(4), 376–393. https://doi.org/10.1080/19186444.2020.1833603
Seraj, M., & Coskuner, C. (2021). Real exchange rate effect on economic growth: comparison of fundamental equilibrium exchange rate and Balassa–Samuelson based Rodrik approach. Journal of Applied Economics, 24(1), 541–554. https://doi.org/10.1080/15140326.2021.1977083
Siddharth, A., Alexiou, C., & Vogiazas, S. (2024). Exchange Rate Regimes in India: Central Bank Interventions and Purchasing Power Parity in the Context of ASEAN Currencies. Economies, 12(4). https://doi.org/10.3390/economies12040096
Sugiyono. (2019). Metode Penelitian Kuantitatif, Kualitatif, Dan R&D. Alfabeta : Bandung.
Usman, K. (2023). The nexus between remittance, exchange rate and economic growth of E7 economies: Frequency domain analysis. Heliyon, 9(11), e21554. https://doi.org/10.1016/j.heliyon.2023.e21554
Published
2026-06-05
How to Cite
Huda, A., Bawono, A., Iqbal, M., Ghani, W., & Normasyhuri, K. (2026). Determinants of Economic Growth in ASEAN-5: A Sharia Economics Analytical Perspective. Jesya, 9(2), 1229-1249. https://doi.org/https://doi.org/10.36778/jesya.v9i2.2731
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Articles
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