HUBUNGAN KAUSALITAS ANTARA KEDATANGAN WISATAWAN MANCANEGARA DAN CADANGAN DEVISA: STUDI KASUS DI INDONESIA

ABSTRACT SITI NUR IRAENI. The Causal Relationship between Tourist Arrivals and International Reserves: The Case in Indonesia. Economics Education, Faculty of Economics, State University of Jakarta, 2018. In the last decade, tourism has emerged as one of the major industries in Indonesia. The tourism industry contribute US$ 8,6 billion dolar of international reserves in 2011 indicated by 7,64 million of tourist arrivals (National Tourism Satellite, Ministry of Tourism and Economic). The objective of this paper is to investigate the casual relationship of international reserves and tourist arrivals in Indonesia. To test the hypotheses, we use a monthly time series data in the case of Indonesia over the period 2004 until 2016. We use a Vector Autoregressive model (VAR) to analyze the dynamic interaction between international reserves and tourist arrivals. Based on the cyclical component generated by Hodrick-Presscott (HP) filtering procedure, we found acyclical relationship between international reserves and tourist arrivals. Then, using Granger causality test, we obtained that causality running from international reserves to tourist arrivals. Those imply that in the long term, tourist arrivals can stabilize international reserves and could be an alternative tool to maintain international reserves. Keywords: tourist arrivals, international reserves, cyclicalit