Abstract:
The volatility of natural resource commodity prices is a global issue that has gained
attention from researchers and academics due to its importance in a nation's
socioeconomic development. Considering the significance of natural resources for the
sustainable development of a nation and investigating the impact of macroeconomic
indicators on natural resource commodity price volatility in Indonesia, this study was
conducted using economic theory and empirical analysis. The study used secondary data
sources from 2001 to 2020, including the Goldman Sachs Commodity Index and the
World Bank Index, and applied Autoregressive Distribution Lags tests to examine the
relationship among the study variables. The findings revealed that foreign direct
investment, gross domestic product growth, human capital index, exports, expected
inflation, industry conditions, and economic conditions all positively impact natural
resource commodity prices in the short and long term, with varying degrees of impact in
the short term. Policymakers and practitioners can use these results to implement
effective policies related to natural resource commodity price volatility that benefit the
people in developing economies.
