The Effect of International Coffee Bean Prices, Exchange Rates, and Coffee Export Volume on Indonesia's Economic Growth

ABSTRACT :

Indonesia ranks among the world's four largest coffee producers, yet the capacity of its coffee export sector to translate commodity price booms into sustained GDP growth remains poorly understood. This study investigates the partial and simultaneous effects of international coffee bean prices (X1), the Rupiah/USD exchange rate (X2), and coffee export volume (X3) on Indonesia's economic growth (Y) over the 2015–2024 period. Annual time-series data were drawn from the Central Bureau of Statistics (BPS), Bank Indonesia (BI), the International Coffee Organization (ICO), and the International Trade Centre (ITC), with analysis performed via multiple linear regression in SPSS 26. Classical assumption tests—Kolmogorov–Smirnov normality, VIF multicollinearity, scatter-plot heteroscedasticity, and Durbin–Watson autocorrelation—confirmed model validity. International coffee bean prices had a positive and statistically significant partial effect on economic growth (β = 10.295; p = 0.042), consistent with windfall-revenue transmission through farm-gate income multipliers. The exchange rate exerted a negative and significant effect (β = −65.353; p = 0.047), indicating that imported inflation from Rupiah depreciation outweighs the export-price competitiveness benefit. Coffee export volume showed no significant partial effect (p = 0.166), attributable to Indonesia's structural reliance on low-value-added green bean exports. The simultaneous F-test was also insignificant (F = 2.342; p = 0.173), with an Adjusted R² of 0.309. These findings challenge a simplistic export-led growth narrative for commodity-dependent economies and point to downstream processing and proactive exchange rate management as necessary conditions for connecting coffee exports to broad-based GDP growth.