DEVELOPMENT OF POST-PANDEMI INFLATION IN REGENCY/CITIES IN EAST JAVA: LITERATURE REVIEW DEVELOPMENT OF POST-PANDEMI INFLATION IN REGENCY/CITIES IN EAST JAVA: LITERATURE REVIEW

Abstract

Inflation is an important variable on a macroeconomic scale because each movement will have a significant impact on economic fundamentals, such as economic growth and unemployment. This study examines both theoretically and empirically how post-pandemic inflation develops, especially in the East Java region, with the period used in 2022. This study aims to measure the persistence of inflation at the district/city level in East Java. Inflation persistence indicates that the inflation rate returns to its equilibrium level after a shock was carried out in eight districts/cities in East Java. The test results show that the post-pandemic inflation rate for 2022 in Java tends to fluctuate. One of the main causes of the increase in the inflation rate is the Highest Retail Price (HET) for cooking oil and fuel oil (BBM). The biggest contributor to inflation came from the foodstuffs group. Then the degree of inflation in eight regencies/cities in East Java is still relatively high, so it requires attention from the regulator. So that the government needs to develop alternative strategies to control inflation so that it is stable, such as optimizing the role of the Regional Inflation Control Team (TPID), social protection through the Family Hope Program (PKH), free groceries, pre-employment benefits, village BLT, and PBI JKN (BPJS Health). The various existing programs must also be supported by intense distribution supervision.