he Nexus between Globalization Index and Financial Soundness on GDP Per Capita in ASEAN-6
Muhammad Rifqy Satria
Ariodillah Hidayat
Xenaneira Shodrokova
Hendriyanto Hendriyanto
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Abstract
This study aims to examine the relationship between the KOF Globalization Index (KOFGI) and financial soundness (FS), and the impact of this relationship on gross domestic product (GDP) per capita in ASEAN-6 countries. The KOFGI is a composite measure that captures the economic, social, and political dimensions of globalization. This study employs panel data from six ASEAN countries over the period 2008–2022. The analysis uses a panel-data regression approach with the Random Effects Model (REM), selected based on the Chow, Hausman, and Lagrange Multiplier tests. The results indicate that globalization has a positive and significant effect on real GDP per capita. FS, proxied by the regulatory capital-to-risk-weighted assets ratio, also shows a positive and significant impact on GDP per capita. These findings suggest that higher global integration and a stable financial system contribute to economic growth by enhancing investment, improving market efficiency, and strengthening investor confidence. The study implies that ASEAN countries should promote well-managed economic openness while maintaining financial stability to achieve sustainable economic growth.
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