Journal of Security and Sustainability Issues

In today’s globalized world characterized by economic independence, which is a measurable component of the level of relations among countries, economic dependence started to affect the direction, content, and intensity of these relations. Thus, the economy has taken the central role of diplomatic activities, while the border between the traditional political and diplomatic activities has become less visible. Purpose of the article: However, to express a numerical value-added for the economy, it is necessary to define the econometric model for calculating the correlation above precisely. It is necessary to define the order of integration of a series of economic diplomacy and macroeconomic aggregates. The research will try to prove the paper’s primary hypothesis, which states that a series of economic diplomacy and macroeconomic aggregates activity movements are fractionally integrated. Methods: This will be tested by standard stationarity I(0) and unit root I(1) tests and fractional integration tests. The following tests were used to create tests of fractional integration: Geweke Porter-Hudak (1983), Log Periodogram Regression test (GPH), and Moulines–Soulier (1999) Log Periodogram test (MS) Davidson and Sibbertsen (2009). through the program Time Series Modelling version 4.48. Findings & Value added: The stationarity I(0) and unit root I(1) tests, as well as the fractional integration tests, showed that the series of economic diplomacy movement are commonly fractionally integrated, by which this paper’s hypothesis was proved, namely that the series of economic diplomacy and macroeconomic aggregates activity movements are fractionally integrated. Since the stationarity, I(0) and unit root I(1) tests, as well as the fractional integration tests showed that series are commonly fractionally integrated, along with the simultaneous use of the structural relation and fractionally integrated relation in further research which measure the effect of economic diplomacy on macroeconomic aggregates movement. Our study results show a positive link between economic diplomacy and the country’s macroeconomic performances in the long run.

The Financial Services Authority of Indonesia (OJK) survey in 2016 has shown the financial literacy index in Indonesia was only about 21.8%. A lot of illegal investment in Indonesian society in recent years proves that the Indonesian people have not fully understood the benefits and risks of financial decision making. The research describes demographic factor and risk tolerance in the context of Indonesia’s society. The questionnaires distributed online and were obtained 850 respondents. To analyze the role of demographic factors on the willingness to take risks, we use Subjective Risk Tolerance, which is describing the respondent’s perception of risk. The result indicates that gender and age statistically insignificant in describing risk tolerance. Meanwhile, marital status, income, and education significantly important in determining risk tolerance. Gender equality in the working environment means women and men have an equal chance to get job and position in a company. This chance also means that women have a great chance to get more income and wealth than before. Marital status related to responsibility, the greater the responsibility assumes the smaller the level of risk tolerance. The better the knowledge, the better the understanding of the financial decision. Information processed and used to make a better decision. The result shows that in order to conduct an education program and increasing society’s knowledge, Government of the Republic of Indonesia, especially to The Indonesia Stock Exchange and Securities Firm should make attention to demographic factor and fit the investment product with investor’s profile.