FINANCIAL POLICY FOR A GREEN ECONOMY IN A RESOURCE-RICH EMERGING ECONOMY

Arlyana Abubakar, Prayudhi Azwar (), Riris Shanti Fransiska Pardede and Salman Fathoni
Additional contact information
Arlyana Abubakar: Bank Indonesia, Indonesia
Prayudhi Azwar: Bank Indonesia, Indonesia
Riris Shanti Fransiska Pardede: Bank Indonesia, Indonesia
Salman Fathoni: Bank Indonesia, Indonesia

Bulletin of Monetary Economics and Banking, 2025, vol. 28, issue 2, 229-260

Abstract: This paper analyzes policies aimed at fostering a green economy in a resource-abundant, megadiverse nation such as Indonesia. This study use Delphi and Analytic Network Process methodologies, grounded in the perspectives of regulators, academics, experts, and practitioners in the green economy, to identify the determinants of green financial policies, revealing that fiscal instruments are of paramount importance. Furthermore, both the case and the respondents are Indonesian. This underscores the necessity of instituting incentives in environmentally sustainable sectors and disincentives in carbon-intensive industries. Therefore, the suitable allocation of green budgets within fiscal policy is essential for addressing market failures and expediting the green transition. Moreover, prudential and monetary measures are essential. Asset-based prudential instruments may stimulate demand for green financing, while capital-based prudential instruments could enhance supply. Furthermore, the policy interest rate is crucial for sustaining price and financial stability during a seamless green transition.

Keywords: Green fiscal policies; Green monetary policies; Green prudential policies; Analytic network process; Delphi method; Indonesia (search for similar items in EconPapers)
JEL-codes: D24 F21 O1 Q56 (search for similar items in EconPapers)
Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
https://bulletin.bmeb-bi.org/cgi/viewcontent.cgi?article=2328&context=bmeb (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:idn:journl:v:28:y:2025:i:2d:p:229-260

DOI: 10.59091/2460-9196.2328

Access Statistics for this article

Bulletin of Monetary Economics and Banking is currently edited by Paresh Narayan

More articles in Bulletin of Monetary Economics and Banking from Bank Indonesia Contact information at EDIRC.
Bibliographic data for series maintained by Lutzardo Tobing ( this e-mail address is bad, please contact ) and Jimmy Kathon ().